The Nevada attorney general's office and the Federal Trade Commission on Wednesday said they reached an antitrust agreement over Service Corporation International's planned acquisition of Palm Mortuary Inc., the dominant funeral and cemetery service company in the Las Vegas area.
SCI is seeking to buy Palm's six cemeteries and eight funeral homes in the Las Vegas area, according to a lawsuit filed Tuesday by the attorney general's office.
The nation's largest cemetery operator with $2.1 billion in sales, SCI has agreed to sell Davis Funeral Home and Memorial Park to an FTC-approved buyer in order to acquire Palm Mortuary.
Without the sale of the funeral home and cemetery, the merger would have reduced the number of competitors in the Las Vegas area from three to two. SCI would have controlled 76 percent of the market, with only one significant competitor -- Bunkers Mortuaries, Cemeteries and Crematory of Las Vegas -- according to the attorney general's office.
The federal agency said the transaction would have increased the likelihood that SCI could raise prices unilaterally or through interaction with Bunkers.
"Cemeteries involve major purchases at an extremely difficult time when consumers are most vulnerable," Attorney General Catherine Cortez Masto said in a statement. "It is critical to preserve competition in the cemetery market for local Las Vegas families."
The lawsuit said the merger, unless modified, "will eliminate head-to-head competition in an already highly concentrated market and will result in (SCI) having a monopoly or near-monopoly market share."
The antitrust review "was certainly not a hostile process at all," said Edie Cartwright, a spokeswoman for the attorney general's office.
"This was a formal investigation conducted by our office," said Senior Deputy Attorney General Brian Armstrong.
"We definitely worked collaboratively with them on this agreement," said SCI spokeswoman Lisa Marshall. "It's in everybody's interest to do the right thing for them."
Palm Mortuary did not return a call for comment. Terms of the acquisition were not disclosed.
Funeral Service Insider first disclosed the agreement to merge Palm and SCI three months ago.
The acquisition would be the final chapter for Palm Mortuary as an independent, family-owned company.
Gene and Anna Parks established Palm Mortuary in 1926 at the site now occupied by the Golden Nugget. Anna Parks was the first woman in Nevada to become a licensed funeral director.
The Parkses rented a house in Boulder City in 1933, because the federal government would not start construction of Hoover Dam until there was a funeral home nearby.
The Parkses sold to two businessmen in 1946. The location was moved to 1325 N. Main St., the location of Palm's headquarters today. Charles Knauss took over Palm in 1959 and expanded the funeral home operation to locations around the valley.
The attorney general's office on Tuesday filed the lawsuit and the proposed agreement, which awaits approval by U.S. District Judge Larry Hicks.
Contact reporter John G. Edwards at email@example.com or 702-383-0420.