DOJ Initiates Post-Closing Challenge to Parker Hannifin’s $4.3 Billion Acquisition of Clarcor

Parker Hannifin announced in late November 2016 that it had entered into an agreement to acquire rival Clarcor, a maker of filtration products, and the transaction closed in February 2017. However, the DOJ sued Parker Hannifin post-closing, on September 26, 2017, arguing that the merger of Parker Hannifin and Clarcor combined the only two domestic companies that make aviation fuel filtration systems and parts used by the military and airlines and would thus eliminate the head-to-head competition for the systems. The DOJ’s post-closing investigation raises the question of whether parties should proactively address significant anti-trust issues pre-close, even if the DOJ does not raise an issue during its review of their HSR filings.