the Bass brothers gained control of Walt Disney, and Reliance Insurance did LBOs on Days Inns and Pargas, eight takeovers compared with seventy-two instances where they took greenmail or someone else made the acquisition. Boone Pickens didn't make a single takeover.
The new regime had much to do with the merger boom between 1980 and 1984 in which the value of transactions quadrupled and the theme of acquisitions shifted from diversification and commodities producers to industry consolidation. The most important factor was the change in antitrust enforcement under William Baxter, assistant attorney general for antitrust, and James Miller, chairman of the Federal Trade Commission. The antitrust changes proceeded through case examples at first, then the symbolic steps of dismissing the IBM suit and resolving the AT&T suit, then the new 1982 merger guidelines, and finally the visible removal of all restraints in 1984. The number of public companies taken over actually declined over these four years, but the annual number of takeovers greater than $100 million doubled and those over $1 billion rose from three to twenty-eight. In 1984, 84% of the top ten transactions would previously have been challenged on antitrust grounds.
The oil industry was again vital to this market, at first spending its newfound wealth on acquisitions, but later as a target of raiders and other oil companies as oil-related transactions rose to one-third of the total. The loss of foreign reserves through nationalization programs, the failure of several high-profile exploration efforts in the United States, and the low cost of "exploring for oil in Wall Street" stimulated the consolidation that occurred. So did the industry's well-recognized penchant for self-aggrandizement.
The new regime only played an indirect role in the aggressive new leverage standards that fostered the merger boom. The banks reduced their interest coverage requirements on loans for raids and LBOs to only 1.0 times in 1982, and also accepted dramatically higher legal and collateral risks than previously, and, in 1983, interest coverages in the junk bond market similarly fell to 1.0 times. In 1984, highly leveraged bank loans and junk bonds played a crucial role in 44% of that year's doubled merger volume. The new regime's influence was unintentional, reflecting the banks' need to compete in the new high-cost market of deregulated deposits that began in 1982, and the savings and loan industry's investment freedom as it was deregulated and encouraged to expand with federal deposit guarantees of $100,000. But other factors were also at work in the credit expansion. Mutual funds and insurance companies had been building successful momentum in the junk bond market for several