Changing Gears: Deal Protections Shift As The Regulatory Landscape Evolves

Allocation of merger control execution risk in transaction documents is front of mind for merging parties. The stakes are high where regulatory outcomes are unknown or hard to predict. But the emergence of a more permissive merger control environment may prompt a change in both the balance and nature of deal protections.

Caution in the face of unpredictability

According to our research on global private M&A deals, the proportion of transactions that were subject to antitrust approvals conditions remained relatively steady last year, at 42%.

For deals conditional on FDI approvals, it was a similar picture. The figure increased slightly to 20% of our deals.

Unsurprisingly, the proportion rises for big-ticket deals. These are generally more likely to trigger regulatory filings (especially given the continued proliferation of merger control and FDI regimes). Of our transactions valued at USD1 billion or more, three quarters were subject to