Wednesday, June 17, 2009
Merger Analysis and the Importance of Looking Beyond the Level of Pre-Transaction Competition Between the Merging Parties
Posted by D. Daniel Sokol
Timothy Daniel (NERA) has written on Merger Analysis and the Importance of Looking Beyond the Level of Pre-Transaction Competition Between the Merging Parties.
ABSTRACT: Timothy Daniel discusses four proposed mergers that were challenged by the Federal Trade Commission in 2007 and 2008. Although all four case studies highlight the importance of analyzing data on the degree to which the merging parties have been competitors, they also show that such evidence is not sufficient to assess the state of competition that would result with and without the transaction. As Tim describes below, information on the merging parties’ future competitive plans, the potential for the transaction to generate efficiencies, the competitive responses of rivals, and the future competitive viability of the firm being acquired are important considerations that cannot be ignored.