February 23, 2018 / 2:21 PM / 10 months ago

U.S. sues to stop Norway's Wilhelmsen from buying rival Drew Marine

((This Feb. 23 story corrects termination fee in last paragraph))

FILE PHOTO: The Federal Trade Commission building is seen in Washington on March 4, 2012. REUTERS/Gary Cameron

WASHINGTON (Reuters) - The U.S. Federal Trade Commission said on Friday it would challenge in court the Norwegian company Wilhelmsen Maritime Services’ (WWI.OL) plan to buy smaller U.S. rival Drew Marine Group.

The FTC said the $400 million proposed deal would reduce competition in the market for marine water treatment chemicals, used in a ship’s boiler water and engine cooling water systems.

If Wilhelmsen closed the deal with New Jersey’s Drew Marine, the FTC said the company would have 60 percent of the market for marine water treatment chemicals, while its closest competitor would have 5 percent.

“We disagree with the FTC’s evaluation and will continue to work toward a positive outcome,” Wilhelmsen spokeswoman Benedicte Teigen Gude told Reuters.

She said the deal had been submitted to antitrust enforcers in London and Singapore. It had received approval from Britain, while Singapore’s review was ongoing, she said.

The FTC has filed an administrative complaint with an agency judge asking for the deal to be scrapped.

It also authorized staff to request a preliminary injunction in federal court temporarily stopping the deal while the administrative process goes forward.

In most cases, if the agency wins in federal court, the companies cancel their proposed transaction.

The deal has a $20 million termination fee, according to a statement from Wilhelmsen when the transaction was announced in April 2017.

Reporting by Diane Bartz; Editing by Bernadette Baum

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