Monfort, the nation’s fifth largest beef packer, is concerned about a merger of

Question

Monfort, the nation’s fifth largest beef packer, is concerned about a merger of the nation’s second largest packer, Cargill, with the nation’s third largest packer. Monfort believes that the merger will give Cargill almost 21 percent of the market leaving Monfort with only 5 percent. Monfort believes this merger may result in a violation of federal antitrust laws and wishes to file suit to prevent it.

If Monfort files suit and the merger is deemed to violate antitrust laws, what type of remedy will Monfort want to receive and why?

Explanation / Answer

Monfort wants a remedy of “equitable relief”. Under equitable relief, merger as stated in the question will be prevented as per the guidelines of antitrust law. Further, regulatory body can examine the details of proposed merger as stated in the question. Monfort wants it as a remedy because it increases the market concentration and Cargill can adopt following practices post-merger:

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