Private Equity Deals at Risk After FTC Prior Approval Rule Shift

Private equity firms stand to be particularly exposed to a new FTC requirement that companies get agency approval before flipping certain assets.

The Federal Trade Commission’s rule change requires companies to get agency approval for at least 10 years before they can resell assets bought from merging companies that sold them as the agency’s condition for merger approval. The requirement would apply regardless of the divested asset’s size.

The “prior approval” rule update is the FTC’s latest step, under the Biden administration, to increase its review of small and midsize mergers and acquisitions that largely had fallen off the agency’s ...