Posted by Peter Lattman
Will the Justice Department’s Antitrust Division ever meet a merger it doesn’t like? That’s the question trustbusting types are asking after a year in which the office gave its seal of approval to several controversial combinations — e.g., AT&T’s acquisition of BellSouth; the Whirlpool-Maytag combination; and Monsanto’s recent purchase of Delta & Pine Land.
Thomas Barnett, the head of the Antitrust Division, strongly disagrees with the view that his office has gone soft, reports this week’s Legal Times. He cites a settlement with a dairy company to protect competition in milk sales to a number of schools in Kentucky and Tennessee; a consent decree with Mittal Steel requiring it to sell an asset as part of its purchase of Arcelor; and another consent decree requiring the sale of assets as part of a merger between two power companies (the deal was later blocked by New Jersey officials).
Some say the DOJ’s cautious approach to merger enforcement isn’t just a function of conservative economic thinking, but the result of its losing a high-profile court challenge in 2004, when it unsuccessfully objected to a Oracle-PeopleSoft combination.
Barnett points out that last year the Justice Department initiated 16 merger-enforcement actions — more than the previous two years combined. The Legal Times points out that none of those actions resulted in the DOJ going to trial, and last year’s figures are down substantially from 2000, when the DOJ challenged 48 mergers.
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