The U.S. Federal Trade Commission (FTC) files a lawsuit seeking to block Cencora from selling its veterinary business unit to Covetrus for 3.5 billions dollars.

Reuters, November 13 - U.S. antitrust regulators filed a lawsuit in Federal Court in New York on Friday seeking to block Cencora COR.N from selling its MWI Animal Health business to veterinary products supplier Covetrus for $3.5 billion, arguing that the deal would raise costs for clinics and pet owners.

• The U.S. Federal Trade Commission stated that the proposed transaction would combine the two largest distributors of animal medicines and clinic supplies in the U.S., effectively eliminating direct competition between the two companies.

• Cencora agreed in February this year (link) to sell MWI to privately held Covetrus.

• The lawsuit has been filed in the U.S. District Court for the Southern District of New York, and is supported by the attorneys general of 13 states.

• The U.S. Federal Trade Commission said that Covetrus and MWI are currently engaged in intense price competition, offering discounts and rebates to win business from independent veterinarians and large clinic chains.

• Cencora and Covetrus have not yet responded immediately to Reuters' requests for comment.

• JPMorgan analysts said they do not expect the Federal Trade Commission's challenge to impact Cencora's performance outlook.

• The brokerage expects Cencora to continue pursuing the deal based on its strategic value, but stated that if the acquisition is ultimately blocked, the company may "seek other transactions involving MWI."

• Cencora shares rose about 2% in midday trading.

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