From up --debug:

resolving manifests
 ...
 ancestor 1139fcfeaeda local 1139fcfeaeda+ remote a275c3997e03
...
merging mercurial/ui.py
my mercurial/ui.py@1139fcfeaeda+ other mercurial/ui.py@a275c3997e03 ancestor
mercurial/ui.py@9e7b2c49d25d
 premerge successful

Note that this is a 'backwards merge', which has weird semantics. Manifest
merge gets it right (starting recently), file-level merge gets it wrong (and
always has).