U.S. Antitrust Regulators Publish Significant Guidance Concerning Vertical Mergers – 30-Day Public Comment Period

Sullivan & Cromwell LLP - January 12, 2020

For the first time in 36 years, U.S. antitrust regulators have published guidance concerning their analysis of vertical mergers (i.e., mergers between companies involved in different levels of the same supply chain).  The guidelines, which have been issued in draft form for public comment until February 11, 2020, provide significant insights into the analyses that would be applied by U.S. regulators and will be significant for companies planning vertical combinations in many industries.  The Vertical Merger Guidelines could substantially change (i) the way in which vertical mergers are assessed in allocating antitrust risk in the context of merger negotiations; (ii) the number of vertical mergers subjected to lengthy investigations by the agencies; and (iii) the number of vertical mergers that give rise to enforcement actions.  Parties who may be affected by the Draft Guidelines should consider submitting comments.  Companies in the technology, healthcare, defense and telecommunications sectors are likely to have particular interest in shaping the final guidelines.