"'The two companies collect different kinds of data and if you put the two together the resulting company is quite a data powerhouse,' said Beth Givens of the Privacy Rights Clearinghouse. 'I question if it’s really a good idea to have one company with access to all of that sensitive personal information.'

"Other privacy advocates don’t see the merger as a particular threat, but think that regulation trails technology in leaving too many records too available to data brokers. And whether ChoicePoint and LexisNexis are one company or two, they say, won’t change the landscape."

Again, what makes this deal more problematic than most is the combination of competition and security issues. This is rare combination for a merger in any industry, and it is particularly troubling (from a timing standpoint) under the current political environment.

This is not to say that the companies can not overcome the HSR and Exon-Florio obstacles at the end of the day. However, it is abundantly clear that the companies (and this publication) underestimated the red flags this combination would raise with the FTC and CFIUS and, more importantly, the time and effort it will likely require for the companies to obtain the two consents.

Barring contradictory information from the companies, it is currently anticipated that the HSR and/or Exon-Florio reviews for this deal will continue well into the summer and very likely the fall of this year. It must be acknowledged at this point that a legitimate chance of deal failure exists in this case, the chances of which are currently estimated at less than 20%.

Frontier Pacific Mining Corp (FRP) - Eldorado Gold Corp (ELD)

The companies have issued a fresh round of arguments for and against this transaction in preparation for the June 19, 2008 Frontier general (annual) shareholder meeting. Neither company has offered any new information regarding the unsolicited offer or, more importantly, thee Perama Hill permit status in Greece.

Therefore, it will be stated at this point that this publication anticipates a fairly decisive rejection by Frontier shareholders of the current Eldorado offer, as well as accepting the 'poison pill' provision up for consideration. There is absolutely no indication that the current offer has gained any traction among the majority of Frontiers shareholders, which is in no way surprising given the transparency of Eldorado's efforts.

Furthermore, it is currently anticipated that Eldorado will continue its efforts to acquire Frontier regardless of the outcome of the June 19 shareholder meeting and will ultimately increase its offer to a level where negotiations can be initiated regarding a formal agreement.

Take-Two Interactive Software (TTWO) - Electronic Arts (ERTS)

TTWO has disclosed the following in an SEC filing:

"On June 10, 2008, the U.S. District Court for the District of Columbia (the “D.C. Court”) ordered the Company to show why it is not in compliance with a subpoena and civil investigative demand (“CID”) issued by the Federal Trade Commission (“FTC”) pursuant to its authority under the Hart-Scott-Rodino Antitrust Improvements Act. The subpoena and CID requested that the Company provide additional information in connection with the FTC’s review of EA’s Offer. The D.C. Court has scheduled a hearing on June 24, 2008 to determine whether the Company is required to comply with the subpoena and CID. If the Company cannot negotiate a settlement with the FTC regarding the subpoena and CID prior to the scheduled hearing, the Company intends to oppose the FTC’s petition.

"Prior to the issuance of the FTC’s subpoena and CID, the Company has been cooperating fully with the FTC with regard to their review of EA’s Offer to acquire the Company. The Company has already provided enormous quantities of data and access to key executives, and has offered to provide the FTC staff with additional documents and information. Nevertheless, the Company believes the FTC’s subpoena and CID are unnecessarily broad and would entail unacceptable additional expense to the Company. To limit the inordinate expense and labor that the FTC’s demand would entail, the Company has sought to obtain reasonable limits on the scope of the information sought. The Company will continue to cooperate actively and produce documents in response to the FTC’s previous requests, and will of course attempt to seek an acceptable resolution to this matter as quickly as possible."

This is interesting in that TTWO apparently has little motivation to cooperate fully with the FTC within the context of fending off ERTS. On the other hand, TTWO would seem to be in a better position to successfully reject ERTS in the immediate future if it were to provide information to the FTC which would ultimately compromise the chances of antitrust clearance. At this point, the FTC review can be used by TTWO as leverage either way in dealing with ERTS, it is essentially up to ERTS to increase its offer to an acceptable level in order to inspire TTWO to act promptly in resolving any concerns the FTC has.

Regarding a potential "white knight" entrance by Ubisoft (or perhaps Activision) which has been speculated over the last few days, it is somewhat difficult to believe that TTWO is currently in a position where is actually needs this sort of development. It has become abundantly clear since the "Grand Theft Auto IV" release that TTWO can succeed for the foreseeable future as an independent entity and even may be an acquiror within a short period. Furthermore, it seems extremely unlikely that ERTS would back down from a third- (or fourth) party bid at this stage. These two factors alone make a bidding war seem rather remote, although, again, ERTS will certainly need to increase its offer closer to the $30/share level in the near future if it expects to keep its chances of a formal agreement alive.

Northwest Airlines (NWA) - Delta Air Lines (DAL)

Recent developments in this transaction include a somewhat motivated political effort to block the deal, along with potential problems surfacing from the NWA pilots and machinists unions.

With respect to the former, Minnesota Congressman James Oberstar has sent this letter to the Department of Justice in opposition to the merger. The letter contains the following statements:

The merger itself is likely to lead to less service to small communities, reduced competition in larger markets and higher fares. These problems will exacerbated by additional mergers, which are likely to be triggered by approval of the Delta/Northwest merger. At the end of the process, we may be left with an industry of three network airlines, which will have the ability to undermine the consumer benefits of deregulation.

Regardless of Mr. Oberstar's position, the fact remains -- as stated in his own words -- that this potential combination will not create a monopoly, or even duopoly, among the major commercial airlines. Furthermore, as discussed by this publication, there are virtually no overlapping routes associated with this merger, which is how the DOJ will ultimately determine the deal's fate.

At this point, Congressman Oberstar's intervention is generally considered a non-factor for the transaction success or failure and is perceived as primarily publicity-related more than a concerted effort to stop the merger from proceeding.

The NWA union issues, on the other hand, could obviously develop into a major problem for this deal, much as the union issues on DAL's side almost prevented a formal agreement from occurring. Not only is the NWA pilots union now showing signs of dissent regarding seniority lists (identical to the DAL dissent previously), it has formally petitioned the US Department of Transportation to reject the route transfer application from NWA to DAL that is required to consummate the transaction.

Although there is no precedent for the DOT to actually honor such request, the very act is indicative of the NWA's pilots union position at this point in the transaction. If the companies intend to successfully complete the merger and operate as a combined entity post-merger, the NWA pilots situation will need be resolved rather quickly.

Naturally, the machinists union can not be considered a major sticking point, although NWA's machinists are currently lobbying shareholders to reject the merger. This is extremely unlikely to happen.