Overview
The Federal Trade Commission (FTC) and the US Department of Justice (DOJ) each recently announced that they would accept structural remedies to address concerns that two transactions in the technology industry would reduce competition. These two divestitures are the first consent decrees under the Trump administration and demonstrate the current administration’s willingness to use structural remedies to clear transactions – a marked change from the FTC’s and DOJ’s position during the Biden administration.
On May 28, 2025, the FTC mandated that Synopsys, Inc. and Ansys, Inc. divest assets to mitigate antitrust issues arising from their merger. Synopsys, a chip design software developer, and Ansys, a simulation software developer, announced the $35 billion acquisition in January 2024. Under the proposed consent order, the FTC is requiring Synopsys to divest optical software tools and photonic software tools and Ansys to divest PowerArtist, a power consumption analysis tool.
The DOJ is also requiring divestitures to mitigate competition concerns regarding a transaction between Keysight Technologies and Spirent Communications. On June 2, 2025, the DOJ announced it will require Spirent to divest its high-speed ethernet testing, network security testing, and radio frequency channel emulation tools to allow the transaction to proceed.
In Depth
WHY IT MATTERS
FTC Chairman Andrew Ferguson and DOJ Assistant Attorney General (AAG) Abigail Slater are upholding their prior policy statements to facilitate dealmaking via structural merger remedies rather than blocking transactions outright. This represents a significant change from the antitrust agencies’ unwillingness to consider remedies during the Biden administration. Although the antitrust agencies are now open to settling merger cases, agency officials emphasized that behavioral remedies remain disfavored and structural remedies will only be accepted if they involve the sale of a standalone business.
Chairman Ferguson issued a statement along with the proposed consent order in the Synopsys-Ansys merger, affirming the FTC’s willingness to consider structural remedies when “it involves the sale of a standalone or discrete business, or something very close to it, along with all tangible and intangible assets necessary (1) to make that line of business viable, (2) to give the divestiture buyer the incentive and ability to compete vigorously against the merged firm, and (3) to eliminate to the extent possible any ongoing entanglements between the divested business and the merged firm.” Chairman Ferguson noted that all three of these factors were present in the fix the FTC accepted in the Synopsys-Ansys merger. He also indicated that settlement can be a powerful tool to ensure innovation is not stunted while protecting consumers from reduced competition.
Similarly, AAG Slater issued a press release along with the DOJ consent decree in the Keysight-Spirent deal, stating that “this structural solution preserves competition for key testing equipment used to ensure that data moves quickly and securely across the world.” She also noted that like the FTC, the DOJ is concerned with protecting consumers and ensuring innovation, and that settlement is a means to prevent chilling dealmaking.
Settlement may aid in the dealmaking process, but even after final judgment approving a structural remedy, there may be lingering uncertainty for the merging parties. The DOJ consent decree in the Keysight-Spirent transaction contains a provision that permits the DOJ – in its sole discretion – to reopen the proceeding any time during the five-year period following the entry of the final judgment if it believes the final judgment has not fully redressed the alleged anticompetitive harm. The DOJ may seek additional relief, including divestiture of additional assets. Thus, although the DOJ is seeking to promote mergers and acquisitions (M&A) through the use of tailored remedies, merging parties should be aware that even if they negotiate a settlement to resolve the agency’s concerns, if the consent decree contains a provision allowing the DOJ to reopen its proceeding, the potential for the DOJ to seek further remedies remains – even after the entry of final judgment.
The consent decree in the FTC Synopsys-Ansys transaction highlights another trend: international coordination in merger enforcement. Prior to negotiating remedies with the FTC and the DOJ, Synopsys and Ansys had negotiated settlements with foreign competition authorities in Europe, the United Kingdom, South Korea, and Japan. Notably, the proposed divestitures announced by the FTC mirror the settlements negotiated with these other jurisdictions.
CONCLUSION
The FTC’s and DOJ’s recent decisions to accept structural remedies to clear merger investigations represents a positive change for companies looking to engage in M&A. Although leaders at both agencies signaled they are willing to consider strong divestiture packages from merging parties, it remains to be seen whether the Trump administration FTC or DOJ will accept behavioral remedies.
If you have questions about what this divestiture order could mean for your business, reach out to your regular McDermott lawyer or the authors of this article.
Shannon McCracken, a summer associate in the Washington, DC, office, also contributed to this article.
