On Thursday, the Trump administration took its first antitrust action by filing a lawsuit to block a $14 billion tech deal. The U.S. Department of Justice (DOJ) is attempting to prevent Hewlett Packard Enterprise (HPE) from acquiring Juniper Networks, a competitor in the wireless local area network (WLAN) industry.
According to the DOJ’s complaint, Juniper has quickly grown from a small player in the WLAN market to one of the top three U.S. suppliers of the technology. The DOJ argues that Juniper’s innovation has driven competition and lowered prices for consumers. If the deal goes through, HPE and Cisco—already the market leader—would control over 70% of the market, which the DOJ believes would harm competition.
“HPE and Juniper are strong companies, but this merger would reduce competition by consolidating two key rivals,” said Omeed Assefi, acting assistant attorney general of the DOJ’s Antitrust Division. “The merger would hurt industries across America, from hospitals to small businesses, by limiting innovation and raising costs for wireless technology.”
The DOJ’s complaint also highlighted HPE’s aggressive stance towards Juniper, noting that HPE trained its sales teams to “beat” Juniper in contract bids. One former HPE executive was quoted telling his team, “There are no rules in a street fight,” encouraging them to “kill” Juniper in sales competition.
Both HPE and Juniper have strongly opposed the DOJ’s lawsuit, claiming that the agency’s analysis is flawed. The companies argue that the merger would combine complementary technologies, creating a stronger competitor to global industry leaders. They pledged to “vigorously defend” the deal, stating that other major antitrust regulators have already approved it.
The DOJ’s action marks a shift from the Trump administration’s typical stance on mergers, which has generally been more lenient than the approach of the Biden administration, which recently blocked several high-profile tech deals.