Gorgeous is a conglomerate and its major businesses include department store chains and grocery store chains.Gorgeous recently acquired Connect Corp. ,a mobile-network operator.Connect has the third-largest share of the mobile-network market.This is Gorgeous's first venture into the mobile-network business.Which of the following theories is the most appropriate one for challenging Gorgeous's acquisition of Connect under Section 7 of the Clayton Act?

Question

Quizplus · Accepted Answer

Considering that Gorgeous has acquired Connect,which already enjoys a significant market position (has the third-largest share of the mobile-network market),Connect may gain an unfair advantage over its competitors through its ability to draw on the greater resources and expertise of its new owner.This unfair advantage may deter existing competitors from actively competing with it for market share and cause other potential competitors to be reluctant to enter the market.Therefore,Gorgeous's acquisition of Connect may be challenged on the "unfair advantage to acquired firm" ground under Section 7 of the Clayton Act.

Gorgeous Is a Conglomerate and Its Major Businesses Include Department