[Congressional Record Volume 141, Number 125 (Monday, July 31, 1995)]
[Senate]
[Pages S10917-S10918]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         MERGERS AND TAKEOVERS

  Mr. DORGAN. Mr. President, I noticed this morning that there is a 
news report out that Disney Corp. is intending, for some $19 billion, 
according to the news reports, to purchase Capital Cities/ABC. Now, it 
would be the second largest takeover in U.S. history if the Disney 
Corp. purchases Capital Cities/ABC. I am concerned when I hear, day 
after day and week after week, new proposals--friendly or hostile 
proposals--to merge America's largest businesses into larger and larger 
enterprises. We have seen merger mania in this country before, a wave 
that came and went, but it now seems to be coming again.
  You only have to pick up a newspaper these days to see who is buying 
whom, some with leveraged buyouts, some in hostile takeover proposals, 
and others simply friendly mergers. But it is inevitably true in this 
country that when two corporations become one larger corporation, 
especially in multibillion-dollar deals, it impedes competition.
  You have less competition in this country as you have more 
concentration. Nobody seems to care very much about it. We have a 
thousand attorneys working in the Federal Government on antitrust 
issues. Under the leadership of Anne Bingaman down at Justice, they are 
more active now, and I salute them for that.
  We need to get more and more active to make sure that these mergers 
are in the public interest. We need to ensure that a decision by two 
corporations to combine to make a larger corporation, and grab a larger 
market share, does not impede the competition that drives the free 
market system.
  I have a list of the large proposals for mergers just in the last 
week and months, large financial institutions, large manufacturing 
institutions. Frankly, I think we in the Congress ought to take a close 
look at this practice. I intend to ask the committees of jurisdiction 
to do that.
  If a person goes downtown and buys a shirt or a blouse at a 
department store, you will be required to pay a sales tax, a tax for 
the transaction. I, personally, think we ought to have a fee that is 
supplied to those who want to buy corporations.
  We had a $25 billion acquisition several years ago in which KKR 
purchased Philip Morris. I think they should have paid a fee. That fee 
ought to be used as a resource bank of funds for investment capital for 
small businesses. When big businesses combine and provide less 
competition and more concentration, we ought to get a fee from that 
that is used as seed money and seed capital for small businesses, which 
represent the development of more competition.
  I hope that in the coming weeks we will be able to discuss this in 
relevant committees. I do not have any notion about what the proposed 
merger between Disney and Capital Cities/ABC is 

[[Page S 10918]]
all about. I do not know whether it is good or bad. I say when we see, 
day after day, week after week, more and more megamerger proposals in 
this country for large corporations to combine to become larger, 
inevitably it cuts away at this country's free enterprise system, 
because this system works based on competition. Concentration means 
less competition. It is something we ought to be concerned about and 
ought to care about.

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