Corporate mergers can be tricky things, especially when antitrust issues are factored in, and merging companies can expect a high degree of scrutiny from federal agencies. This is certainly the case in the pending $35 billion Aetna-Humana merger, which was announced in early July. In fact, the government will have an extra 30 days to review the merger, courtesy of Aetna’s refiling of a premerger notification.
Under the Hart-Scott-Rodino Act of 1976, which amended antitrust laws, companies are required to file a premerger notification with both the DOJ and the FTC. A submitted notification starts a 30-day clock, during which the government agencies can review the transaction and request additional information.
By refiling the notification Aug. 19, a new 30-day window began, allowing additional scrutiny of Aetna and Humana. An Aetna spokesperson told me that the refiling was designed to give the government additional time to understand the transaction, and said it’s a relatively common move in complex merger transactions.
An antitrust attorney told me that notification refilings usually happen when a company expects it’ll receive a second request for information from the DOJ and the FTC and thinks it can avoid it by giving the government more time to review the merger.
A recent American Hospital Association letter said the Aetna-Humana merger, as well as the Anthem-Cigna merger, are at risk of reducing insurance competition and innovation and raising prices. The letter said the DOJ should closely scrutinize the two deals for antitrust issues.
Date: August 24, 2015