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Responding to challenges in the merger review process, P.2
In our last post, we began speaking about the merger review process and the potential challenges that can come up for companies. One particularly aspect of the review process that can be a sticking point is the period after the preliminary review of a premerger filing, when the reviewing agency (either the Federal Trade Commission or the Department of Justice, as the case may be) could either terminate the waiting period early, allow it to expire on its own, or make a Request For Additional Information.
If a Request for Additional Information is issued, the waiting period the companies must go through is extended until the companies have “substantially complied” with the request. Typically, at this stage of the review process, the reviewing agency is looking for business documents or other information that will provide additional insight about various matters related to the merger, such as products and services, market conditions, and the potential effects of a merger. The reviewing agency may also request interviews to obtain additional information.
At this stage of the process, the reviewing agency can sometimes overextend itself in requesting information, and one remedy available to companies facing this situation is to seek a modification of the request to make the it more reasonable. This may or may not work. In the event that the reviewing agency doesn’t grant a modification, it is possible to file an appeal of the terms of the request.
To file an appeal, one must go to the General Counsel of the Federal Trade Commission. After an appeal has been filed, the agency will hold a conference in which the companies are to make their case as to why compliance with the Second Request should not be required and present any modifications they wish to have made to the request.
Navigating such an appeal, and other aspects of the review process, is more effective when working with an advocate who understands the process and how to navigate the issues involved. Companies who face problems in the merger review process, therefore, do well to rely on experienced counsel.