Regulators say deal activity fell 22.00% in fiscal 2008

By Cristal Cody

Tupelo, Miss., July 14 - Federal regulators said Tuesday in an annual merger activity report that the number of transactions reported in fiscal year 2008 fell 22.00% from the year earlier.

The Federal Trade Commission and the U.S. Department of Justice's antitrust division released the fiscal year 2008 annual report about transactions filed under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. It covers the period Oct. 1, 2007 through Sept. 30, 2008.

In fiscal year 2008, 1,726 transactions in consumer goods and services, banking and insurance, manufacturing and other industries were reported under the HSR Act, down from 2,201 deals reported in fiscal year 2007.

Of the 1,726 transactions, the FTC and the DOJ conducted second request investigations on 41 of the proposals.

In the 1,385 transactions where the companies requested early termination of the waiting period to close the deals, the government granted 1,021 requests and denied 364 requests.

The FTC challenged 21 transactions in 2008 that led to 13 consent orders, two administrative complaints and six abandoned or restructured deals, according to the report.

The commission challenged transactions that included Schering-Plough Corp.'s $14.40 billion acquisition of Organon Biosciences NV of Holland from Akzo-Nobel because of potential anticompetitive effects on U.S. markets for three common poultry vaccines. Schering-Plough agreed in November 2007 to divest the rights and assets for the three vaccines to Wyeth to settle concerns.

The Justice Department's antitrust division said it challenged 16 merger transactions that led to 15 consent decrees and one transaction that was restructured.

The Justice Department challenged deals that included the $1.60 billion stock merger of mega newsprint producers Abitibi Consolidated Inc. and Bowater Inc. in November 2008. To settle the challenge, the companies had to divest a newsprint mill and are required to notify the government before acquiring interest in any additional jointly owned mills or machines valued at more than $2 million.

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