According to the failing company doctrine, two or more smaller companies are allowed to merge to compete with a larger company even if they are highly profitable as smaller companies.

Question

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The failing company doctrine allows for mergers between failing companies to prevent them from going bankrupt, but it does not allow profitable smaller companies to merge solely to compete with a larger company. The antitrust laws would view such a merger as anti-competitive and could block the merger.

According to the Failing Company Doctrine, Two or More Smaller