M&A Antitrust Expectations for a New Administration

By Dan Scorpio and Liz Sidoti

President Donald Trump’s announcements of Andrew Ferguson to replace Lina Khan at the helm of the Federal Trade Commission and Gail Slater to lead U.S. Department of Justice’s Antitrust Division have signed to the technology industry that significant M&A scrutiny is likely to remain.

In recent years, Republicans have joined Democrats in their fervor to regulate large tech companies, also including broader categories of media and tech-adjacent companies, one of the few areas of bipartisan agreement. And, with Trump’s recently named choices to lead important administration antitrust divisions, that trend is all but certain to continue even as several tech CEOs have become key Trump advisers and, others, significant donors.

The bottom line: tech companies need, now more than ever, to be on their front foot, providing clear justifications early in the deal process about the necessity of potential mergers and acquisitions, and, most importantly, why transactions will benefit market competition.

The ongoing scrutiny of the technology sector, following the tenure of outgoing Democratic FTC Chair Lina Khan, coincides with M&A markets that appear to be anticipating a more lenient antitrust stance from the incoming administration. The total value of deals announced in November 2024 marked the second highest of any month in the previous year, with both the number and value of strategic deals also witnessing an increase during that month. It is anticipated that remedies to facilitate transaction approvals will be revisited in the merger review process, and the new composition of FTC commissioners is likely to reduce the level of scrutiny applied to sponsor deals.

How And What for Should Tech and Tech-Adjacent Companies Pursuing M&A Prepare?

Prepare for a skeptical audience

For tech M&A, Wall Street is not the audience companies now need to win over. Rather, it is regulators. Messaging, media strategy and stakeholder engagement tactics all must be recalibrated from Day One to ensure that companies are speaking directly to those who can make or break their deals in this environment – namely, political audiences and those who influence them, first and foremost.

Prepare for a long process

Announcing the transaction is just the beginning. Approach deal approval like a campaign and build a plan to win votes, convince skeptics and reinforce merger benefits. Identify where potential allies exist in the administration and on Capitol Hill, among industry groups and influential advocacy organizations, and work to address critics’ arguments.

Prepare to engage the grassroots

Recognize that this administration is very responsive to the diverse coalition of voters who propelled Trump to victory. He and the GOP need to keep that coalition together to maintain control of Congress in two years. Influence D.C. from the ground up, identifying influential third parties who can sway public opinion and messaging directly to voters in important states and congressional districts.

Prepare for the unexpected

It’s likely some vocal “shoot from the hip” antitrust views will emerge, just as they did in the previous Trump administration. Avoid overreacting. Instead, separate the passionate rhetoric from the policy reality. Dealmakers, Boards and management teams must factor in this risk as they plan, no matter how difficult that may be.

To successfully navigate this antitrust environment, planning for an assertive, pro-transaction message and campaign beyond the Day One announcement is essential. For tech companies exploring M&A, the ability to reach beyond Wall Street to Washington and Main Street, will make the difference between a completed deal and an unsuccessful process. Toss the old playbook aside and augment your announcement strategy with a digital-centric approach to meet your stakeholders where they are.

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This article was originally published by PRWeek on January 14, 2025 as “How to plan winning M&A campaigns for the new trump administration”

Read the original article: https://bit.ly/Antitrust-TrumpPRW