- Blog
A Renewed Trump Presidency and the impact on Mergers & Acquisitions: Part 1 – Antitrust
- Christopher Kummer
SHARE:
Featured
Renewed Trump Era: Antitrust & M&A Impact
In this outline, we explored the anticipated direction of Trump’s future policies in M&A and antitrust, focusing on potential regulatory strategies and key themes from his previous administration. Future articles will dive into sector-specific predictions and international aspects.
For this summary and analysis, we analyzed a collection of articles, interviews, videos, and podcasts, estimating that it would take approximately 2 hours to engage with the full content.
With Donald Trump now President-elect, there is considerable anticipation around how his administration will shape mergers and acquisitions (M&A) and antitrust enforcement. Drawing on evidence from his previous tenure, we can make informed predictions about Trump’s future policies and regulatory approach. Trump’s last term saw a distinctive mix of traditional Republican deregulatory policies and selective populist interventions. As industries and markets navigate today’s complex landscape—marked by growing market concentration, the dominance of tech giants, and evolving trade relations—Trump’s return to office is expected to bring nuanced changes in regulatory strategies.
Trump’s Historical Approach: A Mix of Deregulation and Populism
During his previous administration, Trump’s approach to antitrust and M&A was initially expected to lean strongly toward deregulation, supporting business growth through limited intervention. While he upheld many of these pro-business expectations, Trump’s administration also actively challenged mergers in certain sectors, especially in technology and media.
Balancing Business-Friendly Policies with Selective Enforcement
Trump’s previous administration took action in ways that surprised many in the business community, particularly with his Department of Justice (DOJ) and the Federal Trade Commission (FTC) intervening in major M&A deals. Key cases, such as the DOJ’s opposition to the AT&T-Time Warner merger, revealed Trump’s willingness to apply a populist lens when assessing large corporate mergers. Despite expectations of a relaxed regulatory stance, Trump’s DOJ brought numerous antitrust cases, particularly in technology, reflecting his administration’s wariness of monopolistic power in sectors affecting public discourse and information.
Outlook: Anticipated Regulatory Stance in Trump’s New Term
Under Trump’s renewed leadership, we can expect a similar mix of pro-business policies alongside select regulatory interventions. Trump’s populist-leaning rhetoric may lead to targeted scrutiny of large tech companies, which he views as overly dominant and potentially detrimental to competition. However, he is likely to pursue negotiation-based remedies over structural breakups, relying on behavioral changes that align with a pro-business agenda. For most sectors outside of tech, this administration may lower regulatory barriers to ease mergers and boost market expansion.
Key Themes for the Future of M&A and Antitrust under Trump
Trump’s last term provides valuable insights into the key areas where we may expect continuity or change in antitrust enforcement and M&A approval. Here are several prominent themes likely to define his administration’s policies in this area.
1. A Flexible Approach to M&A and Antitrust Remedies
In Trump’s first term, the DOJ, led by Assistant Attorney General Makan Delrahim, advocated for behavioral remedies to resolve antitrust concerns. Instead of outright preventing mergers, this approach allowed the DOJ to place conditions on corporate behavior, preserving competition without blocking deals outright.
- Behavioral vs. Structural Remedies: Trump’s administration showed a preference for remedies that would alter specific corporate behaviors without dismantling companies. This approach was evident in cases involving vertical mergers, where companies were encouraged to adjust operational strategies rather than face structural breakup.
- Potential Flexibility in Enforcement: In a renewed term, Trump’s administration may continue this strategy of allowing mergers with conditions, particularly favoring vertical mergers in sectors that improve supply chain efficiency or innovation without significantly reducing competition.
2. Revisiting the Consumer Welfare Standard
Antitrust enforcement has long revolved around the “consumer welfare” standard, which evaluates mergers based on potential effects on consumer prices. However, recent years have seen a push for broader interpretations, considering the impact on labor markets, data privacy, and innovation.
- Trump’s Traditionalist Leanings: Trump’s DOJ typically upheld the consumer welfare standard, focusing primarily on consumer prices and economic efficiencies. However, recent trends in antitrust have broadened this standard to include factors such as labor impact and market power beyond pricing.
- Future Focus on Traditional Metrics: While Trump’s administration may give some consideration to factors like labor and data privacy, his approach will likely return to a more traditional consumer welfare focus, assessing mergers based on direct economic impact on consumers.
3. Expected Changes in DOJ and FTC Leadership
Appointments to the DOJ and FTC will play a critical role in shaping Trump’s regulatory agenda. Key positions will influence both the type of cases pursued and the strategies applied to M&A and antitrust enforcement.
- Potential New Appointments: President-elect Trump’s transition team has begun considering leaders for the FTC and DOJ who align with his pro-business philosophy. Gail Slater, a former Trump adviser with experience in tech policy, is among those being considered. Slater’s appointment could signal a more restrained approach to antitrust enforcement, especially in technology.
- Likely Departure of FTC Chair Lina Khan: Under Biden, FTC Chair Lina Khan pushed aggressive antitrust actions against tech giants, promoting structural changes to curb monopolistic behaviors. Khan’s departure, likely under Trump, may shift the FTC back toward a market-friendly stance, emphasizing negotiation and behavioral remedies over structural breakups.
4. The Role of Populist Influence on Antitrust
Trump’s populist instincts, evident in cases like the AT&T-Time Warner lawsuit, introduced political considerations into merger review processes. By opposing mergers perceived as consolidating media influence, Trump aimed to balance traditional pro-business values with public concerns about concentrated power.
- Selective Intervention in High-Profile Cases: Trump’s renewed term could see him applying similar populist reasoning in select cases, particularly involving companies that hold significant sway over public discourse or tech. This approach may lead to greater scrutiny of acquisitions in big tech, media, and data-intensive industries.
- Targeted vs. Broad Regulatory Actions: Rather than sweeping regulatory reforms, Trump is expected to target high-profile cases, responding to public concerns without imposing broad antitrust restrictions that might stifle overall market activity.
International M&A and Cross-Border Policy Implications
While this summary focuses on domestic considerations, Trump’s influence on international M&A and cross-border investments will be discussed in a separate post. His last administration’s stance on foreign acquisitions, particularly those involving critical U.S. industries and tech assets, offers a basis for forecasting potential restrictions on cross-border M&A and a continued focus on national security in international deals.
TAGS:
Stay up to date with M&A news!
Subscribe to our newsletter
