The Antitrust Week In Review
Here are some of the developments in antitrust news this past week that we found interesting and are following.
Biden’s antitrust crackdown adds to anxiety of merger investors. U.S. President Joe Biden’s tougher regulatory stance on big corporate mergers has fueled a rise in investor bets on some deals not being completed, threatening to push the brakes on a record-setting dealmaking boom. Spreads between deal prices and the share prices of acquisition targets widened this week after the U.S. Federal Trade Commission said on Tuesday that a surge in mergers and acquisitions (M&A) would delay antitrust reviews, and that companies that did not wait for their outcome completed their deals at their own risk. On Wednesday, the Information reported that the U.S. Department of Justice was weighing a lawsuit to block UnitedHealth Group’s nearly $8 billion deal to acquire health care analytics and technology vendor Change Healthcare. Such a move would follow its lawsuit to block Aon’s $30 billion acquisition of Willis Towers Watson (WTY.F), which resulted in the insurance brokerages abandoning their deal last month.
U.S. FTC chair calls for tougher stance on defense mergers. U.S. Federal Trade Commission Chair Lina Khan, responding to a letter from progressive Senator Elizabeth Warren, wrote in a letter released Thursday that she believed antitrust enforcers should take steps to block more deals. The FTC and Justice Department, which share the work of antitrust enforcement, will often have merging companies sell assets or agree to certain practices in order to address competition concerns so that planned deals may to go forward. The FTC, to which Khan was recently appointed as chair, tends to review defense industry deals.
U.S. Justice Department says concerned about T-Mobile CDMA shutdown on DISH. The U.S. Justice Department said in a letter that it has “grave concerns” about T-Mobile’s plan to shut down a network that Dish Network uses to offer pre-paid service to customers, many of whom are poor. T-Mobile, which closed its $26 billion deal for Sprint last year, had sold Sprint’s Boost prepaid business to DISH as part of a deal to win U.S. government approval for its merger. The customers were on Sprint’s CDMA network, which T-Mobile has now said that it planned to shut down on Jan. 1. The letter, which was signed by the acting assistant attorney general for antitrust, Richard Powers, said that DISH had approached the Justice Department for help in the dispute.
Edited by Gary J. Malone