Will the Next President Be as Tough on Mergers and Acquisitions as Obama?

Donald Trump likes to make deals. President Obama's administration has made a habit of challenging them.

Over the past eight years, the federal government has been more aggressive in opposing mergers it has called anti-competitive than ever before. Using data from the Federal Trade Commission and The Deal, a subsidiary of TheStreet.com, TheStreet has discovered a pattern of increased regulatory actions challenging mergers that dates back to the Reagan administration. Under Obama, the FTC, DOJ and other regulatory bodies have challenged and blocked a higher proportion of U.S. deals than any previous administration. At the same time, deals are getting bigger and more complicated. Call it "Big Business vs. Big Government."

But Obama's term in office ends soon and his successor may cultivate a more conducive regulatory climate for mergers and acquisitions, but it will largely depend on who that individual is. 

From 2009, when Barack Obama took office, through 2015, the Federal Trade Commission and Antitrust Division of the Department of Justice have challenged 2.84% of proposed merger transactions. While that may appear a nominally small fraction, when compared to other administrations, it is quite high: George W. Bush's administration challenged 2.01% of deals, and Bill Clinton's 1.71%. Under George H.W. Bush, the FTC and DOJ challenged about 1.25% of proposed transactions, and under Ronald Reagan, they challenged about 1%.

Each administration since Ronald Reagan has challenged a larger proportion of mergers, TheStreet has discovered. Source: Hart-Scott-Rodino Act filings with the FTC.
Each administration since Ronald Reagan has challenged a larger proportion of mergers, TheStreet has discovered. Source: Hart-Scott-Rodino Act filings with the FTC.

The Treasury Department has increased pressures as well, issuing three new sets of tax inversion regulations under Obama's watch. Most recently, it laid a fresh set of rules apparently aimed directly at killing a $160 billion proposed merger between pharmaceutical giants Allergan (AGN) and Pfizer (PFE) . The move spurred a backlash, including from a group of 18 former Treasury Department officials who penned an open letter to Treasury Secretary Jack Lew on April 18 urging him to reconsider the department's actions. Deep Dive: Tax Inversions: Explaining What They Are, How We Got Here and What's Next

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