I’ll try to explain:

Clearly there are serious scenarios outside M&A where we accept terrible failures due to regulations. Why not accept some in M&A as well?

Admittedly, I read the other comment as a whataboutism. This explanation seems to help.

I think one could argue that the business failure is likely to affect more people, therefore it’s a greater impact. Still, I ultimately agree with this stance (in the context of business survival, not personal); failure is an inherent risk of business.

Agreed. The number of people affected is a big difference. But I think the comparison does make clear that isn’t necessarily a principled reason not to accept a few failures as part of otherwise useful regulation.

A "few failures as part of otherwise useful regulation" sounds an awful lot like some innocent victims exists, treated as guilty. Treating the (presumed) innocent as though guilty, by regulation even, doesn't sound all that good. In fact, seems there in fact are profound and relevant principles to not accept that.

> some innocent victims exists, treated as guilty

The context in this discussion is comparing the hypothetical of a homeless person dying due to a systemic failure to the hypothetical of a business going bankrupt (without being acquired) due to a systemic failure.

This concept of presumed innocence ought to apply to this hypothetical homeless person: why not give them shelter (analogous to allowing M&A) by default, until someone decides it’s a problem? If a society is willing to accept this personal death, they should be willing to accept a business failure.