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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