Shelton’s Edgewell, under FTC pressure, drops acquisition of Harry’s Inc.

One week after the U.S. Federal Trade Commission sued Edgewell Personal Care Co. to block its proposed $1.37 billion acquisition of Harry”™s Inc., the Shelton company has abandoned the transaction.

Edgewell, the manufacturer of the Schick razor brand, first announced its proposed acquisition last May.

Harry”™s began as a direct-to-consumer wet shave brand in 2013 that sold its products exclusively online before moving into brick-and-mortar retail stores in 2016. The FTC claimed the rising competition of Harry”™s forced Edgewell and its main competitor, Procter & Gamble, to reduce prices and developed previously unavailable value-priced products.

“Allowing Edgewell to bring that disruptor under control by acquiring Harry”™s would have represented a big step back for competition,” said Daniel Francis, deputy director of the FTC”™s Bureau of Competition. “This outcome is good news for consumers across the country.”

Edgewell President and CEO Rod Little did not share Francis”™ diagnosis.

“We are disappointed by the FTC’s decision and continue to disagree with its position,” Little said. “After extensive consideration and discussion, and given the inherent uncertainty of a potential trial, the required investment of resources and time and the distraction that a continuing court battle would entail, we determined that proceeding with our standalone strategy is the best course of action for Edgewell and our shareholders.”

Little added that his company “is moving forward standalone with a strong foundation, a revamped management team and improving underlying performance, and we are confident in our ability to create value.”

Harry”™s co-founders and co-CEOs, Jeff Raider and Andy Katz-Mayfield, said they would explore potential legal action against Edgewell for terminating the acquisition agreement.

“We continue to be perplexed by the FTC”™s process and disregard of the facts,” they said in a press statement. “We know the merger would have benefited consumers greatly. We believe we would have prevailed in litigation, and are disappointed by the decision by Edgewell”™s board not to see this process to its conclusion.”