🪒 The FTC closes in on Big Razor. Is Big Tech next?
The company that owns Schick could use some balmy aftershave right now: The Federal Trade Commission nixed -- nicked? -- a $1.3B deal between Edgewell, Schick’s owner, and Harry’s, a popular direct to consumer razor brand.
Big Razor breaks down like this: According to Recode, Gillette has 47% of the market and Edgewell, which also owns Wilkinson Sword, 13.6%. Startups Dollar Shave Club and Harry’s account for 8.6% and 2.6%, respectively.
Edgwell wanted to gain an edge: So it bought Harry’s last May, not long after the startup’s razors went on sale at Target and Walmart. With a new -- and cheaper -- brick-and-mortar competitor, Edgewell was forced to reduce its prices.
And the FTC wants to keep prices low for consumers: It ruled that the acquisition was “anticompetitive because it will eliminate the growing competition between Harry’s and Edgewell that has been highly beneficial to consumers.”
The FTC is on a roll
In recent weeks, the FTC has blocked mergers involving biotech and cereal companies. The US government, of course, has also been circling massive tech companies at congressional antitrust hearings.
Big Tech is different than Big Razor for a major reason: Companies like Amazon have largely made prices lower for consumers -- and the FTC uses consumer price impact as a key threshold for defining anticompetitive behavior. But the FTC still has a task force looking into previous and future tech mergers.