The Justice Department agreed to drop its lawsuit to block
Justice sued to block the deal in September 2022, arguing that the acquisition would concentrate the markets for residential door hardware and smart locks. The parties were in the middle of a trial in the US District Court for the District of Columbia when they reached the settlement, which is subject to court approval.
Assa Abloy will divest its EMTEK and Schaub premium mechanical door hardware businesses and its Yale and August residential smart lock businesses in the US and Canada, along with other smart lock units in the two countries. The settlement also calls for a monitor to oversee the divestiture.
The divestiture’s scope is broader than Assa Abloy originally proposed, DOJ said in court filings, with a faster transition period and penalties for the company if it doesn’t speedily comply.
The Biden administration DOJ’s antitrust division has largely shunned divestiture remedies out of concern they don’t fully replace the competition lost by an otherwise anticompetitive merger.
“Only a complete injunction preventing the original proposed merger would have eliminated” the risks alleged in the complaint, DOJ said in filings. “Based on the totality of circumstances and risks associated with this litigation, however, the United States has agreed to the proposed Final Judgment, which includes additional provisions and protections to address some of the concerns identified above.”
The case is United States v. Assa Abloy AB, D.D.C., No. 1:22-cv-02791, settlement reached 5/5/23.
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