CONSUMER STAPLES: Pepsi; FTC files suit for rigging competition
(PEP; A1/A)
The allegation by the FTC is "Pepsi provides its favoured large, big box retailer customer with promotional payments and allowances without making these equally available to that customer’s competitors. Pepsi also provides this favoured retailer with various advertising and promotional tools, known as services and facilities, without making those benefits available to its competitors on a similar basis."
The allegation does not look far from normal business practices and will be around nuances of how Pepsi can discriminate between its customers. For example "volume discounts" or "good faith to meet a competitors price" are not grounds for discrimination lawsuit.
Equities no cares noting this, alongside recent FDA action in Tobacco, are coming as a last push from the old administration and may be more of a signalling effort than anything else. In FTC's case, hardliner and Chair Lina Khan is being replaced by a Trump appointee. The vote to take Pepsi on was 3-2 in the 5-member committee (chair is among the 5).
As we have mentioned before FTC will tilt to Trump/Republicans favour soon with his two new appointees.