Working Paper No. 1199

Threatening to Buy: Private Equity Buyouts and Antitrust Policy

Published: February 6, 2018Pages: 6Keywords: Antitrust policy; M&As; Private equity; Temporary ownershipJEL-codes: G32; G34; L13; L22; L40
Published version

Threatening to Buy: Private Equity Buyouts and Antitrust Policy Pehr-Johan Norbäck, Lars Persson and Joacim Tåg


Private equity firms (PE firms) have become common owners of established firms in concentrated markets. We show that the threat of a PE acquisition can trigger incumbent mergers in an otherwise mergerstable industry. This can help antitrust authorities maximize consumer surplus because previously privately unprofitable  but consumer surplus-enhancing – mergers now take place. We thus predict that merger waves among incumbents should follow the development of a local PE industry.

Pehr-Johan Norbäck

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Lars Persson

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Ph: +46 8 665 4504
lars.persson@ifn.se

Joacim Tåg

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Ph: +46 8 665 4524
joacim.tag@ifn.se

Elgar Companion to

Social Capital and Health

Martin Ljunge okt 2018.jpg

Martin Ljunge, IFN, is the author of a chapter, "Trust promotes health: addressing reverse causality by studying children of immigrants", in a new book edited by Sherman Folland and Eric Nauenberg. The cutting edge of research is presented, covering the ever-expanding social capital field.

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