001035 Senator Blasts IBP MergerOctober 8, 2000Washington - Minnesota Sen. Paul Wellstone said the planned $2.4 billion acquisition of meatpacker IBP Inc. is more evidence of the need for tougher antitrust laws to keep markets fair for family farmers. An investment fund linked to Donaldson, Lufkin & Jenrette announced it would purchase the world's largest producer of fresh beef and pork in a deal worth about $22.25 per share in cash. Some industry analysts said the offer was low and could attract other bidders. Wellstone, a Democrat, said he objected to the proposed acquisition because of Donaldson, Lufkin & Jenrette's financial ties to agribusiness giant Archer Daniels Midland Co. ADM has a financial stake in the investment firm as well as its own holdings of about 12% in IBP, Wellstone said. The proposed deal could create vertical concentration squeezing family farmers, he said. “ADM is one of the biggest feed producers in the world -- they make the inputs,” Wellstone said. “IBP is one of the largest packers -- they take the outputs. So family farmers will be squeezed in the middle.” Last year, the Senate overwhelmingly defeated Wellstone's bill to halt mergers of agribusinesses with more than $100 million in revenue for 18 months to give Congress time to tackle the issue. A congressional study released two weeks ago found the U.S. Agriculture Department lacked the expertise or staff to investigate allegations of complicated anti-competitive practices. Farm antitrust issues have long been split among three agencies. The Federal Trade Commission and Justice Department oversee mergers and acquisitions, while the USDA's Grain Inspection and Packers and Stockyards regulates sales and prices within the livestock industry. Earlier this year, the Justice Department appointed a special expert on agriculture antitrust issues to assist in reviewing mergers in that sector.
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