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M&A abbreviation - mergers and acquisitions, on wooden cubes on a light background.

Nastassia Samal

Update 3:35pm: Adds details on expert call with broker on deal.

ForgeRock (NYSE:FORG) pared some of earlier declines, now down 1%, after a report that Thoma Bravo plans to pull and refile its merger notice with U.S. antitrust regulators.

The companies are set to pull and refile to give the deal to give the Dept. of Justice more time to review the combination, according to traders, who cited a Capitol Forum.

ForgeRock (FORG) was falling today amid investor concern the company’s $2.3 billion sale to Thoma Bravo may see an in-depth U.S. antitrust review due to concentration in the identity management sector.

ForgeRock (FORG) didn’t immediately return Seeking Alpha email request for comment.

The investor worry comes as deadline for the initial HSR review may expire as soon as Wednesday, according to traders. M&A investors are also waiting for the preliminary proxy filing on ForgeRock deal, which is expected soon.

The weakness in ForgeRock (FORG) also came after broker UFP held a call with an identity and access management expert. The expert explained that PING and FORG are direct competitors and Okta and Microsoft aren’t considered viable alternatives, especially when dealing with the fortune 1000 group of companies. Listeners to the call came away having more conviction that the deal would get a DOJ second request.

A post by Matt Stoller, Director of Research at the American Economic Liberties Project, on Wednesday, may also be of some concern to investors. Stoller, a former policy advisor to the Senate Budget Committee, argues in a piece that regulators may want to scrutinize the transaction as it would reduce the number of players in the space to three from two as ForgeRock may merge with its competitor Ping Identity leaving only Okta (OKTA) as the other major company competitor in the space.

Stoller highlighted that there are a lot of companies that do identity management, including Google (GOOGL), Microsoft (MSFT), IBM (IBM) and a coterie of small firms.

“But if you are a big customer, then there really are only three companies to buy from,”Stiller wrote in the post “You can get it from ForgeRock, a similar size firm Ping Identity, or its largest rival Okta.”

The Thoma Bravo deal for ForgeRock (FORG) comes after the private equity firm agreed to buy Ping Identity for $2.8 billion in August and SailPoint Technologies for $6.9 billion in April.

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