Antitrust Law Daily Wrap Up, ACQUISITIONS & MERGERS—D.D.C.: U.S. consent decree allowing waste collection company combination gets final approval, (Jul 9, 2015)

By Jeffrey May, J.D.

The federal district court in Washington, D.C. has approved a U.S. consent decree permitting the combination of Waste Management Inc. (WMI) and Deffenbaugh Disposal Inc. (DDI), subject to divestitures. The consent decree requiring the divestiture of small container commercial waste service routes in the Topeka, Kansas, area and in two areas of Northwestern Arkansas was found to be in the public interest. In approving the consent decree pursuant to the Antitrust Procedures and Penalties or Tunney Act, the court noted in a separate order that the Department of Justice Antitrust Division did not receive any comments opposing or criticizing the final judgment during the 60-day public comment period on the proposal (U.S. v. Waste Management Inc., July 8, 2015, Mehta, A.).

On March 13, the Justice Department filed a complaint, challenging the combination on the ground that it would significantly reduce competition in three local markets for small container commercial waste service markets—the collection of municipal solid waste from commercial businesses and retail establishments. The government’s concerns focused on the Topeka market, as well as two Arkansas markets: Van Buren/Fort Smith and Springdale. In Topeka and Van Buren/Fort Smith, the combination of WMI and DDI would have reduced the number of significant competitors in the collection of small container commercial waste from three to two, and four major providers would have been reduced to three in the Springdale area. In addition to its hauling operations in Topeka and Northwest Arkansas, DDI provided services in Omaha, Nebraska, St. Joseph, Missouri, and the Kansas City metropolitan area.

Along with the complaint, the Antitrust Division filed a proposed consent decree intended to resolve the competitive concerns alleged in the complaint. Under the terms of the consent decree, which is now final, WMI was required to divest DDI’s small container commercial waste routes in each of these three markets.

The parties announced the definitive merger agreement in October 2014. The transaction, which was valued at approximately $405 million, was completed on March 26.

The case is Civil Action No. 15-cv-00366 (APM).

Attorneys: Ian David Hoffman for Department of Justice. Brian Keith McCalmon (K&L Gates LLP) for Waste Management, Inc. Vadim M. Brusser (Weil, Gotshal & Manges, LLP) for Deffenbaugh Disposal, Inc.

Companies: Waste Management, Inc.; Deffenbaugh Disposal, Inc.

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