In a September 13, 2019 enforcement action, the Federal Trade Commission required the parties in a sale of a natural gas pipeline to revise their agreement to eliminate a non-compete covenant that the FTC determined was not reasonably limited in scope. The FTC did not express any antitrust concerns about the underlying transaction, but still prohibited the parties from consummating the deal until the purchase agreement was amended. The FTC’s enforcement action is a reminder that the antitrust agencies will closely scrutinize non-competes. These investigations can delay the closing of M&A transactions, even in deals that otherwise present no significant antitrust risk.
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