Edgewell Personal Care has announced it has terminated its agreement to merge with Harry's Inc., for a reported $1.37 million. 

The decision is due to this lawsuit filed by the Federal Trade Commission, which seeks to block the proposed transaction. Harry's says it intends to pursue litigation. 

The FTC says states it has blocked the merger because "the proposed combination would eliminate one of the most important competitive forces in the shaving industry."

The FTC's statement continues, "The loss of Harry’s as an independent competitor would remove a critical disruptive rival that has driven down prices and spurred innovation in an industry that was previously dominated by two main suppliers, one of whom is the acquirer."

The shaving market is dominated by Procter & Gamble's Gillette and Edgewell's Schick. New direct-to-consumer brands such as Harry's and Billie provide consumers with high-quality, affordable alternatives. Harry's moved into brick-and-mortar stores in 2016 -- and became a more serious competitor.

Daniel Francis, deputy director of the FTC’s Bureau of Competition, says, "Harry’s is a uniquely disruptive competitor in the wet shave market, and it has forced its rivals to offer lower prices, and more options, to consumers across the country. The Harry’s and Flamingo brands represent a significant and growing competitive threat to the two firms that have dominated the wet shaving market for decades. Edgewell’s effort to short-circuit competition by buying up its newer rival promises serious harm to consumers.”

Edgewell Says It Is Moving On

Edgewell says it is now moving forward as a standalone company and is pursuing its strategy to create value for shareholders.

Rod Little, president and CEO, Edgewell, says, "We are disappointed by the FTC's decision and continue to disagree with its position."

Little continues, "After extensive consideration and discussion, and given the inherent uncertainty of a potential trial, the required investment of resources and time and the distraction that a continuing court battle would entail, we determined that proceeding with our standalone strategy is the best course of action for Edgewell and our shareholders."

He adds, "Edgewell is moving forward standalone with a strong foundation, a revamped management team and improving underlying performance, and we are confident in our ability to create value. We are committed to building a next generation CPG company by leveraging our core strengths, strategically adding to our capabilities and increasing engagement with consumers and retailers to enhance our ability to drive growth and value creation." 

More About Edgewell -- and Its Brands

Edgewell operates in more than 20 countries with extensive retail reach across 50 countries.

The company has a diversified revenue profile across geographies and segments. North America represents about 60% of the Company's global revenue and its international businesses contributes 40%.

By segment, Edgewell's Wet Shave business represents nearly 60% of its revenue and the Sun Care and Feminine Care segments add up to more than 40% of its revenue.

Its strong stable of brands include Schick, Wilkinson Sword, Banana Boat, Hawaiian Tropic and Playtex, as well as its newer brands, Bulldog and Jack Black.