According to the well-known "merger paradox", in a Cournot market game mergers are generally unprofitable unless most … firms merge. The present paper proposes an optimal merger mechanism. With this mechanism mergers are never unprofitable …

to the merger. We show that a PPO reduces the minimal synergy level necessary to make a merger beneficial for consumers …. It follows that an antitrust authority ignoring existing PPOs when evaluating merger proposals (which reflects the … current EU merger control regime) invites sneaky takeovers: Acquiring firms strategically use PPOs prior to a full merger …