Antitrust

UK supermarket M&A will return in bargain bin

25 April 2019

The competition watchdog blocked Sainsbury’s proposed $9 bln takeover of Asda. CEO Mike Coupe has few palatable options to cope with German discounters and the revival of UK peers. Deal fever will resurface after the rot sets in and the grocer’s share price has fallen further.

T-Mobile and Sprint can bear antitrust pain

16 April 2019

The telecom firms have yet to convince U.S. officials over their $88 bln merger. They may have to make cuts, like selling T-Mobile’s prepaid unit or spectrum. Bigger rivals Verizon and AT&T are already diversifying. Unless trustbusters get draconian, combining is the best bet.

Netflix gives a new meaning to “Hollywood ending”

3 April 2019

A proposal to require that movies be shown in theaters for a set time to be eligible for Oscars may be illegal, the U.S. antitrust chief warned. It’s odd the DOJ cares, but it has a point. Such tactics show how much streaming services like Netflix threaten Tinseltown’s old guard.

Google fines make case for tougher antitrust curbs

20 March 2019

Europe has hit the Alphabet unit with its third penalty in less than two years, taking the toll to over $9 bln. That sum pales against the $600 bln the firm has added to its market cap since the investigations began in 2010. Both sides are being pushed to a bigger showdown.

Spotify pitches Apple lament to easy EU audience

14 March 2019

The Swedish music service filed a European Commission complaint alleging that its rival’s payments system hurts competition. It may take years, but the EU has pursued similar cases against the likes of Google. It’s also well timed given the growing backlash against U.S. Big Tech.

RWE’s German carve-up looks better than E.ON’s

14 March 2019

A year after a 17 bln euro asset swap, the German utilities’ deal is in Brussels’ antitrust sights. It’s more an issue for E.ON, which may lose out if forced disposals erode hoped-for cost savings. RWE, meanwhile, seems to have chosen the right time to bulk up in renewables.

Big Tech’s best bet is to friend U.S. regulation

11 March 2019

The push to rein in Silicon Valley giants is intensifying. Elizabeth Warren, a White House contender, wants to break up Amazon and others. Tougher rules protecting users and privacy could stave that off. Those fighting constraints rather than trying to shape them may regret it.

Tech giants get glimpse of watchdog’s M&A bazooka

27 February 2019

The U.S. FTC is creating a body to police anticompetitive behavior in Silicon Valley, and isn’t ruling out the possibility of breakups. While unwinding mergers would be extraordinary, the mere threat would be a useful weapon as the agency investigates Facebook’s privacy breaches.

Now AT&T has to make its business case

26 February 2019

The U.S. telco won its legal battle, with an appeals court upholding the legality of the firm’s $85 bln acquisition of Time Warner. Clearing that hurdle is a relief for boss Randall Stephenson. Next up is persuading investors the deal and the huge related debt load make sense.

Franco-German industry push sullies EU principles

21 February 2019

The two biggest euro zone countries want to limit the European Commission’s antitrust powers, and subsidise strategic sectors. Their fear of Chinese dominance is fair. Yet the reforms may help governments to prop up national champions, and undermine the bloc’s single market.

Verisign may be the real dot-com monopoly

19 February 2019

Facebook, Google and others are under fire for social-media dominance. But $21 bln Verisign exclusively manages .com domains. The U.S. government just extended its contract and allowed price increases. With a 63 pct operating margin in 2018, it’s already sitting on a gold mine.

EU risks picking wrong fight with foreign giants

13 February 2019

France and Germany want to help companies fend off Chinese and U.S. behemoths by merging. Yet Europe’s fragmented markets and limited state subsidies mean it will never win the size game. Better to double down on strict antitrust rules while blocking unfair foreign buyers.

Derailed train M&A spells poor EU antitrust revamp

6 February 2019

Competition tsar Margrethe Vestager blocked Siemens and Alstom’s rail merger in defiance of Franco-German pressure. Paris and Berlin are agitating for rule changes and may back a replacement who will be more willing to create regional champions. That would be a mistake.

Siemens-Alstom is poor advert for EU champions

5 February 2019

German and French politicians are annoyed because the rail merger may be blocked. But their argument that the deal is needed to shield Europe from Chinese competition is flawed. The duo’s workers may also suffer. This is the wrong regional standard-bearer to promote.

EU can afford to shunt Siemens-Alstom to a siding

18 January 2019

Margrethe Vestager may well block the rail groups’ merger. That would rile German and French politicians yearning for a European champion to face down distant fears of Chinese dominance. But if the antitrust tsar pulls the plug, neither Siemens nor Alstom would suffer too much.

Big Tech may face another front in D.C. battle

16 January 2019

William Barr, set to become U.S. attorney general, wonders how Silicon Valley “behemoths” like Amazon got so big. That hasn’t been a DOJ focus. Facebook’s clout was one reason for AT&T’s purchase of Time Warner, on whose board Barr sat. It could make him a new antitrust threat.

Review: Saving capitalism from itself

4 January 2019

From France's "gilets jaunes" protests to the election of Donald Trump, faith in the system is weak. Two new polemics, "The Curse of Bigness" and "The Myth of Capitalism" blame a lack of competition. Updated antitrust rules can help fix that. It's a plausible aim.

UK audit reform leaves unfinished business

18 December 2018

Britain wants companies to use two auditors and stricter Chinese walls between consulting and book-keeping. The moves should help competition, but they won’t be as effective as radical options like breaking up groups and market-share caps, nor prevent failures like Carillion.

SSE comes off worse in energy M&A short-circuit

17 December 2018

The UK energy group’s plan to merge its retail unit with that of Germany’s Innogy collapsed, after a price cap undermined the transaction’s logic. Innogy can still do a deal with new owner E.ON. SSE’s transition to renewables looks murkier, and its generous payout more fragile.

Holding: Big tech cruising for antitrust bruising

26 November 2018

Facebook’s Russian-meddling fumbles and Amazon’s second-headquarters hubris are Exhibits A and B for legal reform. Derided as “hipster antitrust,” the idea that bigness alone can breed evil is true to competition law’s original aim. It’s time trustbusters became disruptors, too.