Publication Date
2-27-2026
Document Type
Article
Abstract
A new wave of emerging companies developing foundation models has unleashed fierce competition in generative artificial intelligence. These emergents have significant innovation capabilities threatening incumbent tech companies. To protect themselves, incumbents have responded by partnering with leading product developers and subsuming smaller startups through quasi‑mergers.
To determine whether quasi‑mergers are cooptive acquisitions, this Article scrutinizes the Google–Character, Microsoft–Inflection, and Amazon–Adept transactions. These case studies describe the deployment of acquired assets before and after the merger and explore their potential effects. However, the analysis is plagued by the uncertainty inherent in nascent competition. Consequently, through contextual comparisons of circumstantial evidence like exclusive licensing agreements, price premiums, market product proximity and product discontinuation, the Article assesses the relative risk of harm to innovation.
Even if there is high probability of harm, the structure of a quasi‑merger shields incumbents from government intervention because enforcement agencies cannot use injunctive relief to restrict employee mobility. To avoid agency inertia, the Article proposes potential remedies involving founders, their employees, and enforcement agencies, without limiting the exit options of startups.
Recommended Citation
Kazimirov, Alexandros
(2026)
"Mergers and Cooptive Acquisitions,"
Mercer Law Review: Vol. 77:
No.
2, Article 10.
Available at:
https://digitalcommons.law.mercer.edu/jour_mlr/vol77/iss2/10