WASHINGTON – The U.S Department of Justice (DOJ) and twelve states on Monday filed a civil antitrust lawsuit to block the proposed acquisition of National Beef Packing Co. by Brazilian-based JBS S.A.

The DOJ reportedly said that the deal would company two of the top four U.S. beef packers and would result in lower prices paid to cattle suppliers and higher prices for consumers. The attorneys general of Colorado, Iowa, Kansas, Minnesota, Missouri, Montana, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Texas and Wyoming are joining the department’s lawsuit.

The department said it is not challenging JBS’s acquisition of Smithfield Beef Group Inc. from Smithfield Foods Inc.

If allowed, JBS's acquisition of Kansas City, Mo.-based National would reportedly make it the largest U.S. beef packer, with an ability to slaughter more than 40,000 head of cattle per day and annual sales of more than $14 billion.

"The combination of JBS and National will likely lead to grocers, foodservice companies and ultimately American consumers paying higher prices for beef," said Thomas O. Barnett, assistant attorney general in charge of the antitrust division. "It will also lessen the competition among packers in the purchase of cattle that has been critical to ensuring competitive prices to the nation's thousands of producers, ranchers and feedlots."

Source: U.S. Department of Justice