Federal Trade Commission Chairman Robert Pitofsky Thursdayoutlined some factors the FTC considers in determining whether andto what extent restructuring can save an otherwise anticompetitivemerger proposal. In remarks at the Cutting Edge AntitrustConference of Law Seminars International in New York City hestressed the need for transparency on behalf of federal regulatorsas restructuring proposals become more complex.

“My intent today is not to describe a new or revised policy butto describe what we are doing, and have been doing, for sometime… to set out more fully than before the various factors thatinfluence, in my mind, decisions to restructure.” In recent years,he said, enforcement agencies have been offered more ambitious andcomplicated restructuring proposals to address overlaps and otherpotential anticompetitive effects.

Last year was a banner year for mergers and acquisitionsworldwide. There were 31,528 deals worth $3.4 trillion, accordingto Thomson Financial/Securities Data. The FTC and the JusticeDepartment both have to review mergers. The agencies usuallyconsult with each other to determine which is most capable ofevaluating a particular deal. In recent years, the FTC hasgenerally reviewed oil deals, and Justice has examinedtelecommunications mergers.

Pitofsky said that in complex cases involving extensiverestructuring, “the likelihood of success of restructuring oftendepends on sophisticated predictions about technical and financialfactors in the market, turning on a detailed knowledge ofparticular industries, and antitrust lawyers and economists may notbe the best people to undertake those tasks.”

Often the proposed mergers have substantial efficiencies,Pitofsky conceded. “Mergers and restructuring are a consequence ofan immensely dynamic economy and should be acceptable to an agencylike the FTC-at least where the threat to consumer welfare is notunduly great.”

©Copyright 2000 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.