Question
Hi Mike,
I have a question about theapplicability of 802.4. Below are a set of stylized facts. I wanted to discussthis scenario with you whenever you get a chance. My telephone number is(redacted).
Company X is an investment companyregistered under the 1940 Act
Company Y is also an investment companyregistered under the 1940 Act
Company X and Company Y are their ownUPEs.
Each of Company X and Company Y are managedby investment advisers, who do not control Company X or Y respectively.
Neither Company X nor Company Y controlany other entities.
Neither Company X nor Company Y have anyminority investments in issuers that are valued at above $53.1 million.
Company X intends to purchase 100% ofthe voting securities of Company Y. As consideration for the acquisition,Company X intends to provide Company Y's shareholders with shares of CompanyX's stock.
Assume that the size of person test andsize of transaction test are satisfied.
All of the assets of Company X and ofCompany Y consist of cash, money market funds, and voting and non-votingsecurities, the acquisition of which assets would, I believe be exempt under801.21 of the HSR Act.
Myquestion is whether the acquisition of Company Y's stock by Company X would beexempt under 802.4. Similarly, is the acquisition of Company X's stock byCompany Y exempt under 802.4?
MV COMMETS
The acquisition of Y by X isexempt under 802.4. Because none of the minority holdings of Y exceed $53.1 MMin value, there are no potentially reportable secondary acquisitions either.The acquisition of X voting securities by Y's shareholders would likewise beexempt under 802.4.