WASHINGTON (Legal Newsline) – The Federal Trade Commission (FTC) announced the filing of an administrative complaint against Superior Plus Corp. and Canexus Corp., alleging that their proposed $982 million merger would violate antitrust laws.

Superior is based in Toronto, while Canexus is based in Alberta. The chemical suppliers are two of the three primary producers of sodium chlorate in North America. Sodium chlorate is a commodity chemical for bleaching wood pulp that is used for products such as paper, tissue and diaper liners. If the merger gets finalized, the new company and rival AkzoNobel would control close to 80 percent of the total sodium chlorate production capacity in the continent.

The FTC’s complaint states that sodium chlorate has no viable substitute. It also claims that there are no meaningful imports to compete against the North American producers.

The FTC believes that a merger would lead to anti-competitive reductions in output and higher prices. Additionally, building a new manufacturing facility would cost roughly $200 million and involve a time-consuming construction project. The FTC claims that this makes the barrier to new entry into the market high. Entry is unlikely, the complaint states.

The FTC voted 3-0 to issue the administrative complaint and seek a temporary restraining order and preliminary injunction in federal court. The administrative trial is set to begin on Nov. 29.

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