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1
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ORDER TO HOLD SEPARATE
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EXTRACTED KEY WORDS
RESPONDENT DIAGEO ASSETS SEPARATE COMMISSION AGREEMENT MALIBU RUM CONSENT SPIRITS RUM EMPLOYEES INTERIM MONITOR ACQUISITION CONFIDENTIAL BUSINESS INFORMATION COMPLAINT COMPETITION ACT CAPTAIN MORGAN RUM FEDERAL TRADE COMMISSION EMPLOYMENT DIVESTITURE SUBSIDIARIES JURISDICTION COMMISSION-APPROVED ACQUIRER THEREAFTER COMPLIANCE AGREEMENT PURSUANT PROVISIONS SSWG ACQUISITION CHARGE RESPONDENTS DIAGEO VIOLATIONS |
UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION
COMMISSIONERS: Timothy J. Muris, Chairman
Sheila F. Anthony
Mozelle W. Thompson
Orson Swindle
Thomas B. Leary
__________________________________________
)
In the Matter of )
)
DIAGEO PLC, )
a public limited company, )
) Docket No. C-4032
and )
)
VIVENDI UNIVERSAL S.A., )
a French societe anonyme. )
)
__________________________________________)
ORDER TO HOLD SEPARATE AND MAINTAIN ASSETS
The Federal Trade Commission ("Commission"), having initiated an investigation of the
proposed acquisition by Respondent Diageo plc ("Diageo") and Pernod Ricard S.A. of certain voting
securities and assets of the Seagram Spirits and Wine business conducted by various subsidiaries of
Respondent Vivendi Universal S.A. ("Vivendi Universal"), and Respondents having been furnished
thereafter with a copy of a draft Complaint that the Bureau of Competition proposed to present to
Commission for its consideration and which, if issued by the Commission, would charge Respondents
Diageo and Vivendi Universal with violations of Section 7 of the Clayton Act, as amended, 15 U.S.C.
§ 18, and Section 5 of the Federal Trade Commission Act, as amended, 15 U.S.C. § 45; and
Respondents, their attorneys, and counsel for the Commission having thereafter executed an
Agreement Containing Consent Orders ("Consent Agreement"), containing an admission by
Respondents of all the jurisdictional facts set forth in the aforesaid draft of Complaint, a
the signing of said Consent Agreement is for settlement purposes only and does not constitute an
admission by Respondents that the law has been violated as alleged in such Complaint, or that the
as alleged in such Complaint, other than jurisdictional facts, are true, and waivers and other
as required by the Commission's Rules; and
The Commission having thereafter considered the matter and having determined that it had
reason to believe that Respondents have violated said Acts, and that a Complaint should issue
charges in that respect, and having determined to accept the executed Consent Agreement and to place
such Consent Agreement on the public record for a period of thirty (30) days for the receipt and
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2
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DECISION & ORDER
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EXTRACTED KEY WORDS
AGREEMENT COMMISSION ASSETS BUSINESS PERNOD RICARD MALIBU RUM TRADE DIVESTITURE TRUSTEE ACQUISITION SPIRITS CONSENT CONFIDENTIALITY COMMISSION-APPROVED ACQUIRER PARAGRAPH SERVICES AGREEMENT INTERIM MONITOR SUBSIDIARIES SSWG ACQUISITION FEDERAL TRADE COMMISSION JURISDICTION TRANSITION SERVICES OFFICE SERVICES AGREEMENT PRODUCTION BUSINESSES NON-RUM OVERLAP COMPANIES THEREAFTER COMPETITION EMPLOYMENT FRAMEWORK AGREEMENT |
UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION
COMMISSIONERS: Timothy J. Muris, Chairman
Sheila F. Anthony
Mozelle W. Thompson
Orson Swindle
Thomas B. Leary
__________________________________
)
In the Matter of )
)
DIAGEO PLC, )
a public limited company, )
) Docket No. C -
and )
)
VIVENDI UNIVERSAL S.A., )
a French societe anonyme. )
)
__________________________________)
DECISION AND ORDER
The Federal Trade Commission ("Commission"), having initiated an investigation of the
proposed acquisition by Respondent Diageo plc ("Diageo") and Pernod Ricard S.A. ("Pernod Ricard")
of certain voting securities and assets of the Seagram Spirits and Wine business conducted by
subsidiaries of Respondent Vivendi Universal S.A. ("Vivendi Universal"), and Respondents having
been furnished thereafter with a copy of a draft Complaint that the Bureau of Competition proposed
present to the Commission for its consideration and which, if issued by the Commission, would charge
Respondents Diageo and Vivendi Universal with violations of Section 7 of the Clayton Act, as
amended, 15 U.S.C. § 18, and Section 5 of the Federal Trade Commission Act, as amended, 15
U.S.C. § 45; and
Respondents, their attorneys, and counsel for the Commission having thereafter executed an
Agreement Containing Consent Orders ("Consent Agreement"), containing an admission by
Respondents of all the jurisdictional facts set forth in the aforesaid draft of Complaint, a
the signing of said Consent Agreement is for settlement purposes only and does not constitute an
admission by Respondents that the law has been violated as alleged in such Complaint, or that the
as alleged in such Complaint, other than jurisdictional facts, are true, and waivers and other
as required by the Commission's Rules; and
The Commission having thereafter considered the matter and having determined that it had
reason to believe that Respondents have violated said Acts, and that a Complaint should issue
charges in that respect, and having thereupon issued its Complaint and an Order to Hold Separate and
Maintain Assets, and having accepted the executed Consent Agreement and placed such Consent
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3
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COMPLAINT
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EXTRACTED KEY WORDS
SCOTCH WHISKY UNITED STATES DIAGEO RUM GIN MARKET RESPONDENT VIVENDI SALES SUBSIDIARIES SINGLE MALT SCOTCH PERNOD RICARD DISTILLED SPIRITS COGNAC FEDERAL TRADE COMMISSION BUSINESS ACT POPULAR GIN SEAGRAM PREMIUM RUM PROPOSED ACQUISITION DELUXE SCOTCH AGREEMENT ASSETS SOLD RETAIL SALES COMMERCE WHOLLY-OWNED SUBSIDIARY CORPORATION SCOTCH WHISKIES TERRITORY |
UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION
______________________________
)
In the matter of )
)
DIAGEO PLC, )
a public limited company, )
) Docket No. C-4032
and ))
VIVENDI UNIVERSAL S.A., )
a French societe anonyme. )
______________________________)
COMPLAINT
Pursuant to the provisions of the Federal Trade Commission Act
and the Clayton Act, and by virtue of the authority vested in it by
said Acts, the Federal Trade Commission, having reason to believe
that Diageo plc and its subsidiaries ("Diageo")and Vivendi Universal
S. A. and its subsidiaries ("Vivendi") have entered into an agreement
in violation of Section 5 of the Federal Trade Commission Act, as
amended, 15 U.S.C. § 45, and that the terms of such agreement, were
they to be satisfied, would result in a violation of Section 5 of the
Federal Trade Commission Act and Section 7 of the Clayton Act, 15
U.S.C. § 18, and it appearing to the Commission that a proceeding in
respect thereof would be in the public interest, hereby issues its
complaint, stating its charges as follows:
I. Respondent Diageo
1. Respondent Diageo is a public limited company
organized, existing and doing business under and by virtue of the
laws of England and Wales, with its office and principal place of
business located at 8 Henrietta Place, London W1A 9AG, England.
2. Among other things, Respondent Diageo produces,
distributes, and sells distilled spirits products from facilities
that it owns or operates worldwide.
3. In the United States, Diageo operates its distilled
spirits business through a wholly-owned subsidiary corporation,
Guinness UDV North America, Inc., whose principal business offices
are located at Six Landmark Square, Stamford, Connecticut 06901.
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4
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AGREEMENT CONTAINING CONSENT
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EXTRACTED KEY WORDS
ASSETS CONSENT AGREEMENT SEPARATE COMMISSION COMPLAINT BUSINESS LAW ACCEPTANCE DIAGEO SUBSIDIARIES COUNSEL FACTS DRAFT CONTEMPLATES REPORTS COMMISSION RULE ACCOMPANYING MANNER COMPLIANCE PUBLIC RECORD PROCEEDING APPENDICES DIVEST RELIEF ENGLAND UNITED STATES AVENUE YORK PURSUANT |
UNITED STATES OF AMERICA
BEFORE FEDERAL TRADE COMMISSION
__________________________________________
)
In the Matter of )
)
DIAGEO PLC, )
a public limited company, )
) File No. 011 0057
and )
)
VIVENDI UNIVERSAL S.A., )
a French societe anonyme. )
)
__________________________________________)
AGREEMENT CONTAINING CONSENT ORDERS
The Federal Trade Commission ("Commission"), having initiated an investigation of the
proposed acquisition by Respondent Diageo plc ("Diageo") and Pernod Ricard S.A., of certain voting
securities and assets of the Seagram Spirits and Wine business conducted by various subsidiaries of
Respondent Vivendi Universal S.A. ("Vivendi Universal"), and it now appearing that Diageo and
Vivendi Universal, hereinafter sometimes referred to as "Proposed Respondents," are willing to enter
into this Agreement Containing Consent Orders ("Consent Agreement") to divest certain assets and
providing for other relief:
IT IS HEREBY AGREED by and between Proposed Respondents, by their duly authorized
officers and attorneys, and counsel for the Commission that:
1. Proposed Respondent Diageo is a public limited company organized, existing and doing
business under and by virtue of the laws of England and Wales, with its office and
place of business located at 8 Henrietta Place, London W1M 9AG, England. Diageo's
principal subsidiary in the United States is headquartered at Six Landmark Square,
CT 06901.
2. Proposed Respondent Vivendi Universal is a societe anonyme organized, existing, and doing
business under and by virtue of the laws of France, with its office and principal place of
business located at 42, Avenue de Friedland, 75380 Paris Cedex, France. Vivendi
principal subsidiary in the United States is headquartered at 375 Park Avenue, New York,
NY, 10152.
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5
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ANALYSIS
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EXTRACTED KEY WORDS
SCOTCH COMPETITOR MARKET CONSENT ORDER BUSINESS RUM COMMISSION ASSETS UNITED STATES PERNOD RICARD SEAGRAM GIN PROPOSED TRANSACTION VIVENDI DIVESTITURE MARTELL COGNAC MALIBU RUM CHIVAS REGAL SCOTCH GLENLIVET SCOTCH PROPOSED RESPONDENTS DISTILLED SPIRITS BRANDS SEPARATE PENDING ACQUISITION AGREEMENT CAPTAIN MORGAN PREMIUM RUM MARKET CONCENTRATION |
Analysis to Aid Public Comment on The Provisionally Accepted Consent
Order
_________________________________________________
I. Introduction
The Federal Trade Commission has accepted for public comment from
Diageo plc ("Diageo") and Vivendi S.A. ("Vivendi") an Agreement
Containing Consent Orders ("Proposed Consent Order"). Among other
things, the Proposed Consent Order requires Diageo, as a condition to
acquiring its interest in Seagram, to divest its Malibu rum business
to an acquirer approved by the Commission. Diageo and Vivendi
("Proposed Respondents") have also reviewed a Draft Complaint that the
Commission contemplates issuing.
The Commission and the Proposed Respondents have also agreed to an
Order To Hold Separate and Maintain Assets that requires the Proposed
Respondents to maintain the competitive viability of certain assets
pending divestiture. The Proposed Consent Order will remedy the likely
anticompetitive effects arising from the proposed acquisition by
Diageo and Pernod Ricard S.A. ("Pernod Ricard") of Vivendi's Seagram
Wine and Spirits business ("Seagram") in five relevant product markets
in the distilled spirits industry.
The Proposed Consent Order and the Order to Hold Separate and Maintain
Assets were negotiated between the Commission's staff and Proposed
Respondents after the Commission, on October 23, 2001, authorized its
staff to seek a court order in United States District Court to
preliminarily enjoin the proposed transaction, pending a Commission
determination of the legality of the proposed transaction after a full
trial on the merits in Commission administrative proceedings.
II. The Parties and The Transaction
Proposed Respondent Diageo is a public limited company organized,
existing and doing business under and by virtue of the laws of the
United Kingdom with its office and principal place of business located
at 8 Henrietta Place, London, England W1A 9AG. In the United States,
Diageo's operates a distilled spirits business through a wholly-owned
subsidiary corporation, GuinnessUDV North America, Inc., whose offices
are located at Six Landmark Square, Stamford, Connecticut 06901.
Proposed Respondent Vivendi is a societe anonyme organized, existing
and doing business under and by virtue of the laws of France, with its
office and principal place of business located at 42, avenue de
Friedland, 75380 Paris Cedex 08, France. In the United States,
Respondent Vivendi operates a distilled spirits business through
Joseph E. Seagram & Sons, Inc., a wholly-owned subsidiary corporation
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