Attorney General Loretta E. Lynch Delivers Brief Remarks on Press Conference Call to Announce the Justice Department’s Action to Block Halliburton’s Acquisition of Baker Hughes
Washington, DC United States ~ Wednesday, April 6, 2016
Thank you Bill [Baer], and good morning everyone. Thank you for joining us on this call. I know that there’s a great deal of interest in the activity of today, and we’re pleased to have this opportunity to provide you information and give you a chance to ask questions of Bill on this call. And I thank all of you for following this work and following our economic news.
Obviously, this is one of our significant merger cases. Our merger laws seek to protect the economy by condemning and/or blocking acquisitions that would eliminate rivals, increase market concentration or reduce incentives to compete and to innovate. And when we find those examples in a proposed transaction, the Department of Justice has an obligation to review it and take action.
Halliburton’s effort to acquire Baker Hughes – one of its two leading U.S. and worldwide competitors – violates the core antitrust principles that I have just outlined. The proposed merger would substantially reduce competition in 23 separate markets for oil field products and services, and it would turn many of those markets into non-competitive duopolies.
Now, as we all know, this industry is critical to energy exploration and production both in the United States and around the world. Now America and the American consumer deserve meaningful competition today and in the future in each of these markets so these markets can thrive.
Now, I know the companies do claim that they can overcome these fundamental antitrust problems by offering to divest a mix and match of assets in some of the markets. And those of you who follow these cases know that often times divestiture can be effective – but not always. And the proposal put forth by the companies fails to address our concerns. The proposal is complicated, risky and regulatory, but most importantly, it falls far short of preserving – much less enhancing – the current competitive dynamic. Simply put, the parties’ merger puts competition at risk in too many markets. It’s not fixable and it should be enjoined.
Now, let me offer my thanks to the Antitrust Division team that has worked so diligently to investigate this merger and uncover these many flaws. As the complaint that we filed today illustrates, a vibrant economy depends on meaningful competition and vigilance by the department in challenging transactions like this that threaten to deny our citizens the benefit of competitive markets.
I will be speaking on this topic later today at the American Bar Association’s Antitrust Spring Meeting, but for now, let me again thank you all for joining this call, let me turn the call back over to Bill who will give you further information on the action that we filed today and he will take your questions.