‘Chilling effect’? Finance pros differ on possible outcomes of Biden call to rein in mergers and acquisitions

In fact, LaBine said he expects companies to push more merger activity in the short term, out of caution that the Biden administration might become more sloppy along the way.

“In the short term, there has been a certain acceleration (of M&A activity),” said LaBine. “In the longer term, an additional type of navigation planning and some additional speed bumps, but no dead ends. And those are not dead ends just because the drivers have not changed.”

LaBine and other M&A attorneys contacted for this report quickly found that customers, at least so far, had not picked up the phone, fearing that the M&A market could implode. Co-head of the Financial Institutions Practice Group at the Detroit law firm Honigman LLP, which primarily focuses on bank M&A.

Smaller banks still need size to be competitive and bigger banks see the need to keep growing, he said.

“There are several reasons the market is moving and this (Executive Order) cannot stop or change any of those reasons,” Bell said. “I think these changes (within the order) might make sense. But it doesn’t change the reasons why these (M&A) deals are taking place, and they will continue to take place.”

The executive order “confirms that it is the policy of the (Biden) government to enforce antitrust laws in order to combat excessive industrial concentration, abuse of market power and the harmful effects of monopolies and monopolies – especially when these problems are in labor markets , Agricultural markets, internet platform industries, healthcare markets (including insurance, hospitals, and prescription drug markets), repair markets, and US markets directly affected by overseas antitrust activity. “

Banks have turned to mergers and acquisitions to cope with the financial impact of extremely low interest rates and the need for increased technology spending. The surge in mergers and acquisitions was just restarting in the U.S. after largely pausing during the height of the pandemic.

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