solved Big Mergers Get BlockedSysco, the country’s largest food distributor to

Big Mergers Get BlockedSysco, the country’s largest food distributor to hotels, restaurants, and other food-service operations, tried to acquire rival US Foods for $8.2 billion. As part of its overall strategic plan, Sysco believed that merging with its largest rival would help reduce costs and allow savings to be passed on to customers. The deal would have created a single company valued at more than $65 billion in annual sales with 25% of the U.S. market.The Federal Trade Commission (FTC) filed a lawsuit challenging the transaction on antitrust grounds, stating the merger would lead to higher prices and diminished service for restaurants, hotels, and schools that contract with the two food distributors. Recently a federal judge agreed with the FTC and blocked the merger, saying it would reduce competition and potentially harm businesses and consumers.Less than a decade ago, AT&T was blocked from acquiring T-Mobile. To date, Sprint and T-Mobile have engaged in “on-again, off-again” back-and-forth discussions. However, AT&T, which has not lost its urge to merge, recently made an $85 billion bid for Time Warner. The Justice Department adamantly disagrees with the merger, ­saying that it has the potential for AT&T to unilaterally price out competitors who might offer content owned by Time Warner. As mergers become more commonplace, there will be those who stand to gain and some who stand to lose. However, the Department of Justice will continue to determine the winner without a heavy expense to consumers.Questions for Critical Thinking1. Discuss the various types of contingency planning that might have been done by restaurants or schools in anticipation of the merger between US Foods and Sysco.2. Discuss the recent mergers that have taken place in financial services, media, automobile, and retail. Are there other industries that are ripe for mergers? Why? Why not?