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> the US regulatory environment is less relevant than the strictest regulatory environment in which you do or hope to do business. I would really recommend tha

by stale2002 6y ago

> the US regulatory environment is less relevant than the strictest regulatory environment in which you do or hope to do business. I would really recommend that you become more informed on the issue of EU anti-trust enforcement. I just did a bunch of research myself. Here is a source from quoting the EU president himself. https://www.reuters.com/article/us-eu-competition-juncker/juncker-rejects-gripes-that-eu-blocks-mergers-idUSKCN1PU0SY https://www.reuters.com/article/us-eu-competition-juncker/ju... "Juncker said the Commission had only ever blocked 30 mergers and approved more than 6,000." https://www.jonesday.com/en/insights/2020/06/eu-court-raises-bar-for-commission-to-block-certain-mergers https://www.jonesday.com/en/insights/2020/06/eu-court-raises... Source showing how weak EU anti-trust enforcement is After doing more research, is clear that the EU is doing much less enforcement against merges than even I previously thought, and I am now going to claim that the EU regulators aren't doing much enforcement either. Really I am quite surprised at how little the EU is doing, and should have looked that up much earlier, instead of taking your initial claim at face value. Furthermore, I can only find a single example, in the history of EU anti-trust law, of the EU blocking a US merger. And that was in 2001 regarding a GE acquisition. If there is only a single example, in the history of EU anti-trust law, of the EU blocking a EU merger, a whole 20 years ago, then it is pretty clear that the EU is not doing much enforcement against US mergers. So my point stands. You concede that the US is not doing much enforcement of anti-trust law. And the fact that the EU has only ever been successful in doing so a single time, 20 years ago, means that the EU is pretty irrelevant to this conversation as well.

arcticbull 6y ago
> Really I am quite surprised at how little the EU is doing, and should have looked that up much earlier, instead of taking your initial claim at face value. Again, the number of blocked vs approved isn't particularly relevant. What matters is also the number that weren't tabled in the first place, and obviously, the number of things that didn't happen is a particularly challenging set to count. Companies aren't fond of public failure, and so they'll try and suss out whether regulators would be amenable to a merger before making it public. 6,000 vs 30 is a meaningless metric, because 6,000 small companies merging into 3,000 small/midsize companies isn't relevant to this discussion as it doesn't do much to alter the competitive landscape. 30 mega-caps merging into 15 giga-caps is what I'm talking about. I'm not saying companies should never merge, that's fine, it's in their competitive interest to do so. Mergers are good for companies because they reduce competition and improve margins. Again, what you haven't explained is why a small company merging into a small company is advantageous, a mid size into a midsize is advantageous, but a giant into a giant just wouldn't ever work. Of course it would work, the same dynamic continues to exist. Regulators are why. T-Mobile just acquired Sprint, right? So we know there's certainly an advantage on the business front to consolidate these businesses. So why doesn't AT&T buy T-Mobile to form AT&T&T? Well, they tried in the early 2010s and the DOJ filed suit is why. [1] Further AT&T had to pay a huge amount of cash to T-Mo when it all unwound. [1] https://som.yale.edu/sites/default/files/ATT%20-%20T-Mobile%20Merger%20analysis%20for%20website.pdf https://som.yale.edu/sites/default/files/ATT%20-%20T-Mobile%...
- stale2002 6y ago
  > 6,000 vs 30 is a meaningless metric Even if you think that, the metric of only a single american merger ever being prevented, and it happening 20 years ago, is still pretty relevant. If the regulators in Europe have only blocked a single merger in America, ever, then European regulators are simply not relevant to the conversation, and you have already conceded that American regulators aren't doing much. You cannot handwave away the true fact that the EU has only stopped a single American merger, one time, 20 years ago. And that this is pretty good evidence that European regulators are not doing much to prevent American mergers. > T-Mobile just acquired Sprint Huh. And I guess European regulators didn't do anything about that, did they? In the clear and obvious cases of geographic network effects in the industry of Telecom, which I have already stated is one of the few exceptions where regulation is definitely needed (Telecom, has huge geographic network effects. It is the same problem as internet, or electricity, or water pipes, and I have already said that network effects are the one major area that consolidation will definitely happen), we see that European regulators didn't stop such a clear an obvious thing that should have been stopped. > 6,000 small companies merging Well, in one of the cases of large telecoms companies, such as t-mobile/sprint we see that it wasn't blocked! > so they'll try and suss out whether regulators would be amenable to a merger before making it public. Well they didn't stop the clear and obvious example that you just brought up regarindg T-Mobile/sprint. Looks like European regulators are doing much of anything. So no, European regulators are not doing much of anything at all, to prevent American companies from merging, using an example that you brought up. > Well, they tried in the early 2010s and the DOJ filed suit is why As I said, before, businesses that have huge geographic network effects are one of the few exceptions where there is a huge advantage to consolidation. But even IN these clear and extremely obvious cases, only sometimes will regulators take action. But sometimes they won't either. The fact that nobody blocked the t-mobile/sprint situation is clear evidence that regulators aren't doing much to stop mergers, even in the rare and obvious cases where they should step in.
  - arcticbull 6y ago
    All I'm saying is that mergers that are stopped aren't publicly reported for the most part. They do their due diligence, and if they don't think it'll go through they don't file. The only public failures are the ones where the companies failed to do their diligence on regulations in advance and wind up with egg on their faces.

arcticbull 6y ago

> Really I am quite surprised at how little the EU is doing, and should have looked that up much earlier, instead of taking your initial claim at face value. Again, the number of blocked vs approved isn't particularly relevant. What matters is also the number that weren't tabled in the first place, and obviously, the number of things that didn't happen is a particularly challenging set to count. Companies aren't fond of public failure, and so they'll try and suss out whether regulators would be amenable to a merger before making it public. 6,000 vs 30 is a meaningless metric, because 6,000 small companies merging into 3,000 small/midsize companies isn't relevant to this discussion as it doesn't do much to alter the competitive landscape. 30 mega-caps merging into 15 giga-caps is what I'm talking about. I'm not saying companies should never merge, that's fine, it's in their competitive interest to do so. Mergers are good for companies because they reduce competition and improve margins. Again, what you haven't explained is why a small company merging into a small company is advantageous, a mid size into a midsize is advantageous, but a giant into a giant just wouldn't ever work. Of course it would work, the same dynamic continues to exist. Regulators are why. T-Mobile just acquired Sprint, right? So we know there's certainly an advantage on the business front to consolidate these businesses. So why doesn't AT&T buy T-Mobile to form AT&T&T? Well, they tried in the early 2010s and the DOJ filed suit is why. [1] Further AT&T had to pay a huge amount of cash to T-Mo when it all unwound. [1] https://som.yale.edu/sites/default/files/ATT%20-%20T-Mobile%20Merger%20analysis%20for%20website.pdf https://som.yale.edu/sites/default/files/ATT%20-%20T-Mobile%...

stale2002 6y ago
> 6,000 vs 30 is a meaningless metric Even if you think that, the metric of only a single american merger ever being prevented, and it happening 20 years ago, is still pretty relevant. If the regulators in Europe have only blocked a single merger in America, ever, then European regulators are simply not relevant to the conversation, and you have already conceded that American regulators aren't doing much. You cannot handwave away the true fact that the EU has only stopped a single American merger, one time, 20 years ago. And that this is pretty good evidence that European regulators are not doing much to prevent American mergers. > T-Mobile just acquired Sprint Huh. And I guess European regulators didn't do anything about that, did they? In the clear and obvious cases of geographic network effects in the industry of Telecom, which I have already stated is one of the few exceptions where regulation is definitely needed (Telecom, has huge geographic network effects. It is the same problem as internet, or electricity, or water pipes, and I have already said that network effects are the one major area that consolidation will definitely happen), we see that European regulators didn't stop such a clear an obvious thing that should have been stopped. > 6,000 small companies merging Well, in one of the cases of large telecoms companies, such as t-mobile/sprint we see that it wasn't blocked! > so they'll try and suss out whether regulators would be amenable to a merger before making it public. Well they didn't stop the clear and obvious example that you just brought up regarindg T-Mobile/sprint. Looks like European regulators are doing much of anything. So no, European regulators are not doing much of anything at all, to prevent American companies from merging, using an example that you brought up. > Well, they tried in the early 2010s and the DOJ filed suit is why As I said, before, businesses that have huge geographic network effects are one of the few exceptions where there is a huge advantage to consolidation. But even IN these clear and extremely obvious cases, only sometimes will regulators take action. But sometimes they won't either. The fact that nobody blocked the t-mobile/sprint situation is clear evidence that regulators aren't doing much to stop mergers, even in the rare and obvious cases where they should step in.
- arcticbull 6y ago
  All I'm saying is that mergers that are stopped aren't publicly reported for the most part. They do their due diligence, and if they don't think it'll go through they don't file. The only public failures are the ones where the companies failed to do their diligence on regulations in advance and wind up with egg on their faces.