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  • Cristina Lefter

Killer Acquisitions– Brief overview on concept


We mentioned the concept “killer acquisitions” in a previous article. The topic raises great interest at the moment at international level due to the impact that it may have on competition in emerging product markets (especially technology related ones).[1]


Let’s clarify: ”Killer acquisitions” refer to cases where incumbent companies with important market shares acquire start-ups or smaller players with significant business potential in terms of the products or services that they provide with the purpose to “discontinue the development of the targets’ innovation projects and pre-empt future competition”.[2]


As shown by research,[3] the extent to which a potential acquisition may be qualified as a “killer acquisition” most times escapes the scrutiny of competition authorities, because the parties involved in such acquisitions do not meet the turnover thresholds for merger clearance (by assumption, the thresholds are not met, because the acquired company is new to the market and/or has a market share well below the relevant thresholds).


In this case, the questions arise: how can competition authorities identify “killer acquisitions” and, moreover, how can it be proven from the onset (i.e. from the acquisition date) that the intention of the acquirer is to “kill” the future competitor or its product, when the result of the acquisition can actually be seen some time after its completion?


The answers to these questions appear to be yet under discussion amongst competition law experts. For the time being, however, it appears that a post-factum review would be the only tool available for competition authorities. This idea appears to be supported by a recent opinion expressed by the Advocate General with the European Court of Justice (of which we have written here). For sure this topic will gain ground as more start-ups launch into innovation and efficiencies which would benefit consumer and competition, thus attracting the appetite for acquisitions of established players.

[1] The OECD allocated a whole panel to the topic in 2020 - https://www.oecd.org/daf/competition/start-ups-killer-acquisitions-and-merger-control.htm. Also, other sources have recently evoked this concept - see: https://insights.som.yale.edu/insights/wave-of-acquisitions-may-have-shielded-big-tech-from-competition [2] Cunningham, C., Ma, S. and F. Ederer (2018). “Killer Acquisitions,” https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3241707, cited in OECD (2020), Start-ups, Killer Acquisitions and Merger Control www.oecd.org/daf/competition/start-ups-killer-acquisitions-and-merger-control-2020.pdf [3] OECD (2020), Start-ups, Killer Acquisitions and Merger Control, www.oecd.org/daf/competition/start-ups-killer-acquisitions-and-merger-control-2020.pdf

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