Playpower has abandoned its proposed acquisition of rival BCI Burke, Illinois Attorney General Kwame Raoul and the Federal Trade Commission announced Oct. 27, just a week after Raoul and a bipartisan coalition of 12 attorneys general filed a lawsuit challenging the deal.
Playpower and Burke are two of the largest commercial outdoor playground manufacturers, according to Raoul's office. The coalition had alleged the merger would drive up prices and reduce innovation and quality for equipment bought by schools, churches, parks and recreation departments, and other organizations across the country.
Less than a week after the lawsuit was filed, the companies terminated their agreement and plan of merger. Raoul and the coalition have filed a notice of dismissal of the case with the U.S. District Court for the Northern District of California.
"I am proud of the collaborative work done by my office's Antitrust Bureau to stop this illegal merger between two of the country's largest playground manufacturers," Raoul said. He said the lawsuit identified concerns including significantly increased prices for schools and park districts in Illinois and nationwide "despite an already over-priced market."
Daniel Guarnera, director of the FTC's Bureau of Competition, said the decision "is a win for American consumers and will help drive down the prices that schools, churches, daycares and parks departments pay for playgrounds." He said state and municipal governments spend hundreds of millions of dollars on playground equipment each year, making taxpayers among the biggest beneficiaries of continued competition between the two firms.
The complaint alleged the deal would significantly increase concentration in an already concentrated market and eliminate the companies' rivalry. According to the announcement, only five companies — including PlayPower and Burke — own more than a dozen playground equipment brands and hold 85% to 90% of U.S. market share.
Joining Raoul and the FTC in the lawsuit were the attorneys general of Arizona, California, Colorado, Nevada, North Carolina, Ohio, Pennsylvania, Tennessee, Texas, Washington and Wisconsin.