Sen. Elizabeth Warren (D-Mass.) raised issues with the proposed merger between Dick’s Sporting Items and Foot Locker on Tuesday, citing the potential blow for American households and companies.
“Dick’s and Foot Locker at the moment compete with one another and with unbiased retailers to safe offers with suppliers. The brand new big would have considerably elevated energy to extract favorable situations with producers,” Warren wrote in a letter to the Federal Commerce Fee (FTC) and Antitrust Division of the Division of Justice (DOJ).
“This might imply that unbiased retailers are at a drawback in terms of negotiating with suppliers, which might give Dick’s and Foot Locker an incentive to have interaction in anticompetitive conduct to limit suppliers from coping with unbiased retailers,” she added.
The Massachusetts senator stated mother and pop outlets might be threatened by the deal, valued at $2.4 billion.
From 2017 to 2022, one out of each 4 shoe shops throughout the U.S. closed, which resulted within the lack of greater than 25,000 jobs in the identical interval, Warren’s workplace stated, citing Census Bureau statistics on the economic system.
Warren additionally referenced a CreditKarma study launched final month during which 39 p.c of fogeys stated they might not afford back-to-school purchasing this 12 months.
“Dick’s Sporting Items’s proposed acquisition of Foot Locker would mix two of the nation’s largest athletic footwear retailers, creating a large that might have elevated energy throughout the enterprise, from suppliers to employees to clients,” Warren stated.
“This deal might elevate costs for households already dealing with increased sneaker prices from President Trump’s tariffs and threaten employees and small companies,” she added.
Warren stated blocking earlier mega-mergers has confirmed helpful for customers, citing the failed merger between grocery giants Kroger and Albertsons.
“Following Kroger and Albertsons’ loss in courtroom, the brand new CEO of Albertsons revealed the advantages of preserving competitors by describing how the corporate now deliberate to enhance to maintain costs low ‘to draw extra customers’ with a view to compete with rival firms,” Warren stated.
“It is a placing instance of the advantages of competitors for customers, and will give antitrust businesses the arrogance to proceed vigorously imposing antitrust legislation,” she added.
The DOJ and FTC didn’t instantly reply to requests for touch upon Warren’s letter. The Hill additionally reached out to Dick’s and Foot Locker.