A court granted the Federal Trade Commission's request to block Henkel from acquiring Liquid Nails, a rival of its construction adhesive brand Loctite.

The U.S. District Court for the Southern District of New York granted the FTC's request for a permanent injunction to block the deal on Friday following a seven-day trial, the FTC said Monday.

Under the proposed deal, Henkel planned to buy Liquid Nails for $725 million from private-equity firm American Industrial Partners. The FTC had sued to block the deal last December, alleging it would combine the two biggest brands of construction adhesives, hurting competition and leading to higher prices and lower quality.

"This proposed acquisition threatened to drive up the cost of a critical product for building and maintaining homes across the United States," FTC Bureau of Competition Director Daniel Guarnera said in response to the court's order.

American Industrial Partners acquired Liquid Nails through its 2024 purchase of PPG Industries' architectural-coatings business, which was renamed Pittsburgh Paints.

Pittsburgh Paints said it is aware of the court's decision and plans to drive long-term growth through its entire product portfolio, including its Liquid Nails, Mulco and Homax brands.

"The company highly values our adhesives, sealants and restoration products that customers hold in high regard," Pittsburgh Paints said.

Henkel and American Industrial Partners did not immediately respond to requests for comment.

The FTC also said the court win is part of its new approach to seeking permanent injunctions to block what it views as anticompetitive mergers without the need to continue cases in administrative proceedings.