Graco ordered to hold separate and maintain finishing equipment business assets while FTC considers settlement

The Federal Trade Commission has ordered Graco to hold separate and maintain its assets while Graco is completing its acquisition of Illinois Tool Works’ finishing equipment businesses. Graco is to hold separate the worldwide liquid finishing equipment businesses of Illinois Tool Works Inc. and ITW Finishing LLC. While the liquid finishing equipment businesses cannot be integrated into Graco’s operations, all other acquired businesses can be integrated.

The separate businesses–Binks, DeVilbiss, Ransburg, and BGK–will continue to compete with Graco while the Commission considers the proposed settlement between the FTC staff and Graco. The FTC had challenged the deal in December 2011, finding competition concerns in North American markets for industrial equipment for spray paint and liquid finishes on manufactured goods, such as cars and appliances. As ITW is Graco’s largest rival, the FTC considered the acquisition’s effects on future Graco innovation and discounts offered to distributors.

Full content: FTC Press Release

Related content: Observations on the Commission’s Evanston Remedy: When Is Divestiture, or Any Remedy, Not Appropriate for a Consummated Anticompetitive Merger? (Mark Botti, Akin Gump)