• The European Commission revises merger guidelines to support defense sector deals.
• The revised guidelines introduce a 'theory of benefit' framework, considering merger efficiencies.
• The UK's CMA is also becoming more open to behavioral remedies and efficiencies.
• Foreign investment screening across Europe is intensifying, potentially creating complexity for defense deals.

The European Commission's revised merger guidelines may signal a more favorable approach to defense sector consolidation, which could lead to increased investment and innovation in the industry. However, the intensifying foreign investment screening across Europe suggests that national security concerns may still pose a significant hurdle for defense deals, and investors must carefully navigate these regulatory complexities.