SENATE KEEPS EYE ON BARNES & NOBLE PURCHASE 12/24/98 [Newsbytes,465 words]
WASHINGTON, DC, U.S.A., 1998 DEC 24 (NB) -- By Robert MacMillan,
Newsbytes. Senate Commerce Committee member Ron Wyden, D-Ore., is
a noted fan of high-technology progress in electronic commerce. As a
result, he recently said he has sought and received promises from the
Federal Trade Commission (FTC) that the agency would investigate fully
the controversial merger between Barnes & Noble Inc. and Ingram Book
Group.
Although a Wyden staffer told Newsbytes that no further information
was available, several published reports said Wyden is committed to
discovering whether there are any major downsides for the electronic
commerce industry to the Barnes & Noble-Ingram merger.
Newsbytes, which reported the FTC investigation in November, notes
that the FTC and the Justice Department both have planned merger
investigations for Barnes & Noble and Ingram Book Group, which an FTC
source told Newsbytes is typical procedure for these types of
mergers.
Several companies and associations, comprisingly mostly Amazon.com
Inc. [NASDAQ:AMZN] and independent booksellers, have complained that
the merger would harm both independent book dealers and Amazon.com,
which depends on Ingram Book Group as its largest distributor.
Borders Books [NYSE:BGP] also is an Ingram Book Group customer.
The groups also have complained because they suspect a successful
merger will lead to higher book prices.
Ingram Book Group is a subsidiary -- albeit a large one -- of Ingram
Industries Inc. It is selling Ingram Book Group to Barnes & Noble
for $200 million in cash and $400 million in stock.
Amazon.com, itself fighting against accusations from retailing
giant Wal-Mart, has long claimed to be the world's largest bookstore,
a claim that was challenged in the media and in the courts by Barnes
& Noble. Barnes & Noble at the time in 1996 was struggling to put
together its own online offering, Barnesandnoble.com, which since has
proven formidable competition for Amazon.com.
Nonetheless, whereas the argument in 1996 was which company had the
bigger aggregate bookstore, the argument now is which company is
smaller -- for Barnes & Noble so it can get its merger approved, and
for Amazon.com so it can prove that the merger should be rejected.
Amazon.com has said that the merger would constitute a barrier to
entry for it to get into the bookseller-distributor market, and
therefore should not be approved.
Reported by Newsbytes News Network, newsbytes.com .
(19981224/WIRES ONLINE, LEGAL, BUSINESS/)
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