Busy season for merger cops

Record deal making is piling up paperwork for U.S. antitrust regulators, with merger filings up 19 percent in the first half of the federal government's fiscal year that began in October.

In practice, though, regulators question only 3 percent of proposed deals and block far fewer deals than in past decades.

Commenting on pending deals that might once have seemed overtly anticompetitive, such as that of metals giants Alcoa and Alcan, Howard University law professor Andrew Gavil says: "It's unclear that five or 10 years ago those deals would have been proposed in a serious way."

Still, not every merger passes muster. These deals face, or could face, federal scrutiny.

Whole Foods/Wild Oats

The deal: Whole Foods in February agreed to buy Wild Oats for $565 million.

The issue: The Federal Trade Commission (FTC) last week sued to block the merger. The only two nationwide chains of organic and natural-food supermarkets compete in 21 geographic areas. The companies say they need to fend off Wal-Mart, Kroger and others, but the FTC says supermarkets aren't direct competitors.

Expected outcome: This deal is almost certainly dead, says J.P. Morgan analyst Stephen Chick.

Google/DoubleClick

The deal: Google in April agreed to buy DoubleClick for $3.1 billion.

The issue: Privacy protection, not market power. The combined company could track Internet usage of 1.1 billion people worldwide, says the Electronic Privacy Information Center (EPIC), which opposes the deal. The FTC has sought additional information from the companies.

Expected outcome: "The odds right now are that the FTC will either modify the deal or block the deal, or at least challenge it in court," says Marc Rotenberg, executive director of EPIC.

XM/Sirius

The deal: The satellite-radio broadcasters agreed in February to a merger valued at $4.7 billion.

The issue: For the deal to go through, the Federal Communications Commission (FCC) would have to overturn its decision to forbid the two from combining licenses. The Justice Department will also scrutinize the deal. The companies say they compete against all audio entertainment.

Expected outcome: Too early to call. The FCC has asked for public comment.

Thomson/Reuters

The deal: Canada's Thomson agreed last month to pay $17.6 billion for U.K.-based Reuters.

The issue: Purchasers of financial-market data could complain that the deal reduces the number of major suppliers to two. Thomson-Reuters would have 34 percent of the market versus Bloomberg's 33 percent.

Expected outcome: Although U.S. and European regulators will scrutinize the deal, Anthony de Larrinaga, an analyst at Société Générale, says opposition has been muted. "The chances of the deal going through are probably better than even," he says.