Government Enforcement Policy of Section 7 of the Clayton Act: Carte Blanche for Conglomerate Mergers

HYPOTHETICAL NEWS ITEM The Exxon Corporation and the International Business Machines Corporation Jointly announced yesterday an agreement to merge the two companies. Exxon, the nation's largest producer-rfner-distributor ofpetroleum products, had 1982 gross operating revenues of $108 billion and has total assets of $64 billion. IBM, the nation's largest manufacturer of computers and office equpment, had 1982 gross income of $33 billion and has total assets of $34 billion. In order to minimize the loss of any actual or potential competition between the firms, the two companies will divest themselves of some minor operations, this will include the spin-off by Exxon of itsfaltering office machines subsidiary. A spokesman for the Department of Justice stated that while that agency was planning to review the proposed merger, the transaction seemed to raise few concerns under the Department's Merger Guidelines announced in June, 1982. Wall Street Journal, Sept. 1, 198-, at 1, col 2.