Join        Login             Stock Quote

Bazaarvoice's (BV) Buy Of PowerReviews Challenged By U.S. Justice Department

 January 11, 2013 07:55 AM

(By Balachander) Bazaarvoice Inc.'s (NASDAQ: BV) acquisition of PowerReviews Inc. has been challenged by the U.S. Department of Justice (DOJ).

The DOJ filed a antitrust lawsuit against the social media marketing company on Thursday, saying the $168.2 million acquisition substantially lessened competition in the market for product ratings and reviews platforms in the United States, resulting in higher prices and diminished innovation.

"This lawsuit seeks to prevent one firm from dominating the product rating and review platforms market, and demonstrates that transactions that are not reported to us are not immune from scrutiny," the DOJ said.

[Related -Futures Fall After ADP Jobs Data; Apple Inc. (AAPL) Slips]

The department said Bazaarvoice's acquisition of PowerReviews was not reported under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, which requires companies to notify and provide information to the department and the Federal Trade Commission before consummating certain acquisitions.

The acquisition of PowerReviews has given Bazaarvoice the incentive and ability to raise the price of its product ratings and reviews platform above a competitive level, the department added.  As a result of the transaction, many customers have lost critical negotiating leverage and are vulnerable to anticompetitive price increases.

Bazaarvoice responded to the DOJ's action, saying it provided the DOJ with extensive documents, data, and information demonstrating that our acquisition of PowerReviews was procompetitive and did not result in a lessening of competition.

[Related -Stocks End Flat As China, Earnings Weigh; Best Buy (BBY) Surges]

"Put simply, at the time it was acquired, PowerReviews was in no way the viable competitive threat the DOJ's complaint tries to suggest," Bazaarvoice said.

The stock, which has been trading in the 52-week range of $7.48 to $21.10, ended at $7.49 on Thursday.

iOnTheMarket Premium


Post Comment -- Login is required to post message
Alert for new comments:
Your email:
Your Website:

rss feed

Latest Stories

article imageGermany Is On The Rebound - Time To Buy?

Based on this year's 17% spike in the Stoxx Europe 600 Index, it seems investors have found a home in read on...

article imageIs Drought Risk In The American West An Economic Threat?

The historic and ongoing drought in California is getting harder to ignore in terms of its potential impact read on...

article imageFunds Behaving Badly

Discipline is still the key to read on...

article imageGenuine Parts Co. (GPC): This Company's Raised Dividends For 59 Years

There are 253 million cars and trucks driving along U.S. roads. And the average age of those automobiles is read on...

Popular Articles

Daily Sector Scan
Partner Center

Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.