Question
From: (redacted)
Sent: Monday, February 14, 2005 4:09 PM
To: Verne,B. Michael
Subject: HSR question
Mike:
Could you pleasecall me when you have a chance. I have a question regarding the acquisition ofa division of a large financial institution that is engaged in factoring. As Iunderstand it, the division has contracts with customers to acquire theiraccounts receivables. It pays the customer on a percentage of the outstandingamounts owed providing the customer with ready cash. The division then collectsthe receivables banking on collecting a large percentage the receivables.
The division'sassets consist principally of the account receivables that the division has acquired,contracts with customers that obligate the customers to sell their receivablesto the division and office equipment, etc. The seller, a large financialinstitution, is engaged, among other things, in financing and lending money.The seller is exiting the factoring business but not exiting the business oflending money and providing financing.
Query whether the sale of the assets that make-up the factoring business fallswithin the ordinary course of business exemption?