Tuesday, April 1, 2008

North Sails Buyout of Rival Quantum Sail Approved

Published: March 31, 2008

WASHINGTON (AP) — The Justice Department has approved the $10.5 million buyout of Quantum Sail Design Group by a rival, North Sails, saying the deal was unlikely to hurt competition or consumers.

Justice Department Statement on Proposed Merger North Sails. The merger was approved without conditions despite opposition from consumer groups and an intense lobbying campaign by the sailing industry.

The combination still requires approval from the International Sailing Federation, which prohibited a merger when it granted 3DL licenses in 1997.

The Justice Department, in a lengthy statement explaining its decision, said the two companies compete not just with each other but also with other forms of cruising and racing. Customers must buy sails that are exclusive to either North or Quantum, and users rarely switch manufactures.

“People just don’t do that,” president of North Sails, Gary Wiseman, said in a conference call with reporters.

The government also appeared to endorse the argument of the companies that they compete with other forms of manufacturing, including “3DL”, and Rota mold technology.