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Acquisitions of this type are illustrated by those made from 1940 through 1948 by the American Home Products Co., a firm which has bought up a whole host of companies in different fields.

Some idea of the variety of fields entered into by the American Home Products Co. can be gathered merely by a listing of some of the widely known brands picked up in the course of the corporation's acquisition drive, some of these firms having been acquired prior to 1940. Thus, the American Home Products Co. has bought up firms owning such well-known brands as Bisodol, Kolynos, Anacín, Old English Wax, Three-In-One Oil, Clapp's Baby Food, Duff's Baking Mix, George Washington Coffee, Chef Boy-ar-dee Spaghetti Dinner, and others.

The companies shown in the top line of the chart represent horizontal acquisitions in the same basic field of American Home Products, namely, drugs and pharmaceuticals. But in addition to buying up other drug and pharmaceutical companies, American Home Prod ucts has bought up a whole series of food specialty companies, companies making waxes and polishes; chemical companies, companies making dyes and paints; an insecticide company, a cosmetic company, and two other companies, making different products.

The Commission feels that the conglomerate type of acquisition is one which is pecularily dangerous to small business. A company that is so diversified is in a position to strike out with great force against any smaller company which may seek to compete with it in any one of the variety of fields in which it is engaged and, of course, it is able to make up whatever losses that are incurred in the competitive war with its profits secured in the other fields in which it is engaged.

For example, let us suppose that I take my total capital which I have stated to be $2, and try to go into the business of producing waxes and polishes, which is only one of the many fields in which the American Home Products Co. is engaged. Suppose I have a new process. I become rather successful. I begin to take business away from this firm.

The firm then would be in a position-I do not say it would actually follow such a policy-but it would be in a position to undercut my prices, sell at a loss until they have driven me out of business. Whereas I was engaged only in one field, they could make up whatever losses they incurred in the wax and polish field by the profits secured from their operations in this variety of other fields. It is for this reason that the Commission regards these conglomerate acquisitions as constituting one of the greatest and most serious dangers to small business.

I have, here, a great number of other charts. But I feel that I have taken up far too much of your time. I appreciate the courtesy that has been extended to me, and I will be glad to answer any questions that you may care to ask.

The CHAIRMAN. Dr. Blair, we would like to have those additional charts in the record.

Mr. BLAIR. Put the additional charts in the record? Yes, sir. (The charts referred to follow.)

GROWTH IN ECONOMIC CONCENTRATION PERCENTAGES OF TOTAL RESOURCES AND PROFITS HELD BY BIG BUSINESS

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