Failing firms

Failing firms (2023 Merger Guidelines 3.1): “This defense applies when the assets to be acquired would imminently cease playing a competitive role in the market even absent the merger.” 3 requirements:

(1) Grave probability of a business failure (very stringent standard)

(2) Prospect of reorganization is dim or nonexistent

(3) Acquiring is the only available purchaser

• Not raised often, nor is it accepted often: if a firm satisfies all three requirements, it is likely a very weak firm anyways, so purchasing is not going to be a reduction in competition