NEW YORK A proposed
consent order settling anticompetition charges over Charlotte
Pipe & Foundry Co.s 2010 purchase of the cast iron
soil pipe business of Star Pipe Products Ltd. has been released
for public comment by the U.S. Federal Trade Commission
The order prohibits Charlotte
Pipe "from enforcing a confidentiality and noncompete agreement
with Star Pipe, ensures that (the company) will publicly
disclose its prior acquisitions of other (soil pipe) importers
and requires (the company) to notify the commission before
making future acquisitions in this industry," the FTC said.
"We are pleased to have this
matter resolved and behind us so we can focus on our
customers," a Charlotte Pipe spokesman told AMM,
adding that the Charlotte, N.C.-based company "cooperated fully
with the investigation and resolved the matter to avoid the
additional expense and uncertainty associated with (it)."
Charlotte Pipe bought Star
Pipes cast iron soil pipe business for $19 million in
2010, reducing competition for the product in the market and
allowing Charlotte Pipe to raise prices, according to the
Charlotte Pipe and Star Pipe
employees also entered into an agreement to keep the
acquisition a secret and signed a six-year noncompete agreement
following the sale, the FTC said.
Houston-based Star Pipe said in
a letter to customers that it had "decided to exit" the cast
iron soil pipe business, according to the FTCs original
complaint, which also said Charlotte Pipe destroyed Star
Pipes cast iron soil pipe production equipment in China
following the sale.
Cast iron soil pipe is used to
transport wastewater from buildings to municipal sewage
systems, vent plumbing systems and transport rainwater to storm
drains. The U.S. market for the product is highly concentrated.
As of 2010, Charlotte Pipe and Birmingham, Ala.-based McWane
Inc. controlled 90 percent of the market, the FTC said.
Charlotte Pipe had bought other
competitors in the sector at various times since the early
2000s, the original complaint said.