The Justice Department said yesterday it would oppose a proposed joint venture between General Electric and Hitachi Ltd., two giant television manufacturers.
The venture would have joined GE and Hitachi into one large television firm owned equally by both firms. The new company, General Television of America Inc, would acquire all of the assets of GE's present television business.
Assistant Attorney General for Antitrust John H. Shenefield sent a letter to GE informing them that the government was opposing the venture, and would, if necessary, sue to prevent it.
"Our investigation and analysis of the proposed venture has led us to conclude that the venture would eliminate significant existing and potential competition between GE and Hitachi in the manufacture and sale of both color and monochrome television sets," Shenefield wrote.
He added that the transaction would "further increase concentration in the already concentrated TV market," pointing out that the Justice Department didn't consider the venture necessary to keep either party a viable competitor in the U.S. television market.
A GE spokesman in Fairfield Conn. stated "We are disappointed that the Justice Dept. did not approve the formation of General Television of America Inc., as a jointly owned company between GE and Hitachi Ltd. We are studying the Justice Dept.'s letter and are reviewing it with Hitachi. GE remains committed to the television business and will continue to look at means to increase the volume and profitability of its television-receiver operations."
GE is one of the five leading sellers of television sets in the U.S., with Hitachi ranking twelfth here. Worldwide, however, Hitachi ranks sixth in sales.
Shenefield noted in his letter that Hitachi "was seriously considering the construction of a new television assembly plant in the United States," prior to commencing discussions with GE over the proposed joint venture.
Meanwhile, Sharp Corp. of Japan announced that its U.S. subsidiary, Sharp Electronics Corp., will build a plant in Memphis, Tenn., to manufacture microwave ovens and color televisions. The venture is Sharp's first U.S. manufacturing plant.