Foley & Lardner LLP partner Diane Hazel is quoted in the Corporate Counsel article, “Antitrust Enforcers Throw Wrench Into M&A by Dusting Off Long-Ignored Governance Rule,” discussing the Federal Trade Commission’s recent employment of a little-used provision of a federal antitrust law to force drastic changes to major energy deal.
“We should anticipate the FTC may be looking for and preparing to bring other challenges now that it is expanding Section 8 enforcement,” Hazel commented.
Foley recently told clients that the FTC’s action “should give pause to companies that share officers and directors with competitors, participate in joint ventures or other collaborations that may involve the exchange of competitively sensitive information, or that are contemplating transactions that could threaten either, eventually.”
Hazel explained that because interlocking directorates are often found in private equity and because private equity invests in a broad range of industries, the FTC’s newfound interest in Section 8 could have far-reaching consequences, noting that the technology industry could also be a target.
“As their businesses grow and expand into new areas, who constitutes a competitor may evolve and change,” Hazel added. “With regular sales and acquisitions, tech companies may find they have an inadvertent interlock and should exercise increased diligence.”