Federal Trade Commission Chairman James C. Miller III moved yesterday to delay Mobil Corp.'s $5.1 billion takeover of Marathon Oil Co. as well as the signing of an agreement that would have allowed the purchase provided the two oil companies were kept separate.
Miller, who called the takeover "very important" in an interview, asked the two companies for further information about their businesses and the impact the purchase would have on the oil industry.
The request, under the Hart-Scott-Rodino merger regulations, puts no time limit on when the companies must respond, but freezes the takeover until 10 days after the FTC receives the data. A federal judge in Ohio also has blocked the stock deal until a hearing Tuesday to consider a preliminary injunction.
Meanwhile, Ohio Attorney General William J. Brown filed a civil antitrust suit against Mobil yesterday seeking to block the purchase. The suit, which also names Merrill Lynch, Pierce Fenner & Smith Inc., Mobil's agent, says the deal would stifle competition in violation of Ohio's antitrust laws. Brown also is seeking a preliminary injunction to bar the deal.
Brown told reporters in Cleveland that gasoline prices would rise by about three cents a gallon if the takeover were successful. In addition, Brown said the takover would leave 43 percent of the gasoline sales in Ohio controlled by Mobil and Standard Oil Co. (Ohio), and said Marathon supplies one-third of the gasoline sold by independent suppliers.
Controversial negotiations among the two companies and the FTC about a Mobil proposal for a so-called "hold separate" order also appeared stymied. "If I were to offer it to the commission, my inclination is to have all" the documents in the second request, said Thomas J. Campbell, director of the FTC's Bureau of Competition.
The full commission would have to approve the the hold-separate deal, a draft of which has been sharply criticized by members of the Ohio congressional delegation. Rep. Mike Oxley (R-Ohio) had called it a "sweetheart deal."
Sen. Howard Metzenbaum (D-Ohio), one of a group of congressional critics of the Mobil bid, said he is "obvious ly pleased" at the FTC's request for information. "I am disturbed to learn, however, that the chairman is still considering this sham hold-separate agreement," Metzenbaum said.
"Even on the facts already known, this merger is no good--it's bad for the economy, bad for oil industry competition, bad for the people of Findlay, Ohio, and it won't add a drop of oil," he said, calling for quick action to block the takeover.
Both companies acknowledged receipt of the second request for information, and Mobil said it was dicussing the hold-separate agreement with the FTC. Mobil also noted that the FTC has a "truly monumental" amount of data about the oil industry in light of materials obtained by the agency in its massive, but now-defunct, suit against all the major oil firms.
In addition, Mobil said the FTC has received materials that Mobil submitted to the Justice Department in connection with that agency's review of Mobil's unsuccessful attempt to acquire Conoco Inc.
Miller, who was briefed on the deal for an hour before signing the request, called the deal important "if for no other reason than it is a large merger in an industry which has been beset by a great deal of government regulation, in part, which is now being phased out." All four FTC members have supported the action informally.
When the review is completed, the FTC can seek a preliminary injunction delaying the merger, permit it under certain conditions, such as with the hold-separate agreement, issue an administrative complaint challenging the purchase or do nothing at all.