Senator Chuck Grassley released the following statement after the Department of Justice filed a consent decree in the proposed acquisition by Tyson Foods of Hillshire Brands that would require Tyson to divest its sow purchasing business, Heinold Hog Markets, before the acquisition of Hillshire could proceed.
Earlier this month, Grassley wrote the Justice Department pressing the agency to closely scrutinize the acquisition. Grassley said he had heard from independent producers who feared that Tyson could engage in the practice of ‘tie-in’ sales of sows with market hogs, which would put independent producers at a tremendous disadvantage as they looked for markets for their sows.
“I appreciate that the Justice Department took my concerns into consideration in regard to the slaughter sow market. It appears that the concerns I was hearing from independent producers were well-founded, and a merger without conditions would have allowed the new company to control more than one-third of the slaughter sow purchasing market. We’ve seen in previous acquisitions the serious difficulties that can arise when monopsony concerns and the impact of concentration on farmers as consumers are not taken seriously.”
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