Matt Levine’s Money Stuff: Not Merging Is Not Securities Fraud

Not everything is securities fraud

A thing that sometimes happens is:

1. Two companies agree to a merger. The buyer will buy the target at some premium to its current stock price.
2. They put out a nice press release saying things like “we are doing this merger” and “here is the price” and “we expect it to close in the third quarter.”
3. The target’s stock price goes up to reflect the premium in the deal.
4. The next step is getting antitrust approval.
5. The deal does not get antitrust approval. Antitrust regulators decide that it is bad for competition, so they block ...