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13 N.Y.L. Sch. J. Int'l & Comp. L. 181 (1992)
The Australian Approach to Mergers and Acquisitions: Merits and Drawbacks

handle is hein.journals/nylsintcom13 and id is 187 raw text is: THE AUSTRALIAN APPROACH TO MERGERS AND ACQUISITIONS: MERITS AND DRAWBACKS Stacey L Romberg* I. INTRODUCTION A large portion of antitrust law, on an international scale, is devoted to the regulation of mergers and takeovers. The regulation of mergers and acquisitions has proven difficult due to the competing benefits and burdens of mergers. Companies choose to merge for a variety of reasons, including the desire to obtain greater market power, economies of scale, tax advantages, and diversification. Gaining a stock exchange listing is another important reason to merge. These advantages of merging do not necessari- ly convert into consumer benefits unless the acquiring company decides to lower prices.' Depending on the particular facts involved, a merger can benefit or harm the economy. A merger strengthens the economy if it allows a company to expand and diversify, increase its efficiency, or lower its costs. These may result from technological and capital cost efficiencies, or distribution, production, and advertising economies. However, a merger can be damaging if it results in less competition, monopolization, avoidance of prohibitions against restrictive agreements, a dysfunctional allocation of resources, or damage to the employees of the targeted company or to the community.2 In response to these varied outcomes of mergers, the legislatures and courts of numerous developed nations have long attempted to draw the line between economically beneficial and harmful combinations. This article will focus on the Australian approach to merger and takeover law. In * Associate at Fort & Schlefer, Washington, D.C. The author gratefully acknowledges Professor Kathleen J. Woody of Georgetown University Law Center and her colleagues at Fort & Schlefer for their assistance in preparing this article. 1. Sally Walker, The Trade Practices Act 1974 and Mergers in the Newspaper Industry, 9 AusT. Bus. L. REV. 322, 326 (1981). 2. Id. at 326-27.

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