New guidelines released Monday by the Justice Department and the Federal Trade Commission outline factors and frameworks that the agencies will evaluate when reviewing mergers and acquisitions.
The updated guidelines come as long-term care is seeing record-level merger and acquisitions activity.
“The reality is, to be successful long-term in this sector, you need scale. The operating complexity of senior living and care is only escalating, and scale, particularly concentrated scale in certain markets, helps with sustainability,” Lisa McCracken, the former director of senior living research and development at specialty investment bank Ziegler, previously told the McKnight’s Business Daily. McCracken now is head of research and analytics for the National Investment Center for Seniors Housing & Care.
Under antitrust laws passed by Congress, the FTC and the DOJ are tasked with preventing mergers that may substantially lessen competition or tend to create a monopoly in an industry. The updated guidelines are the culmination of an almost two-year process that included feedback from the public and staff in a variety of ways, including through listening sessions, written comments and workshops. The guidelines are not legally binding, according to a press release from the Justice Department, but rather are meant to provide insight into how the agencies administer antitrust law.
“These finalized guidelines provide transparency into how the Justice Department is protecting the American people from the ways in which unlawful, anticompetitive practices manifest themselves in our modern economy,” Attorney General Merrick B. Garland said. “Since releasing the draft merger guidelines earlier this summer, we have engaged with stakeholders across the country, and the guidelines are stronger as a result. The Justice Department will continue to vigorously enforce the laws that safeguard competition and protect all Americans.”
The new merger guidelines are meant to consider the intricacies of the modern economy, such mergers that are part of a series of multiple acquisitions or mergers that involve multiple platforms, according to FTC Chair Lina M. Khan.
“The 2023 merger guidelines reflect the new realities of how firms do business in the modern economy and ensure fidelity to statutory text and precedent,” Khan said.
