Book retailing giant Barnes & Noble Inc has called off its bid to acquire distributor Ingram Book Group Inc in the face of antitrust pressure from the Federal Trade Commission. The proposed $600m deal was heavily criticized by Barnes and Noble’s bitter online bookselling rival Amazon.com Inc, for whom Ingram is the largest supplier. The American Booksellers Association had joined Amazon in petitioning the FTC to prevent the merger, claiming it would damage competition in the industry.
The deal had come under a great deal of FTC scrutiny, especially due to the fact that publishing giant Bertelsmann AG owns 50% of barnesandnoble.com and the acquisition could have created a dubious publishing, distribution and retailing powerhouse. Amazon, for its part, had vehemently opposed the deal and issued several public statements condemning it last year.
In withdrawing its application for the acquisition from the FTC, Barnes and Noble said that, although both companies believe that the transaction would have ultimately been approved in the courts, the protracted litigation that would likely result made the deal financially undesirable. It says it will still work closely with Ingram and notes that the $600m is now available for other strategic investments and acquisitions. It will now move forward on building two distribution centers of its own.
