Question
From:(redacted)
Sent:Tuesday, April 18, 2006 5:45 PM
To:Verne, B. Michael
Subject:Compliance Question regarding 16 C.F.R. Section 802.2(c)(1)
Mike,
This question concerns 16 C.F.R. Section 802.2(c)(1) regarding the exemption of unproductive realproperty from the HSR Act. Subject to certain specified qualifications,"unproductive real property" is defined as "any real property,including raw land, structures or other improvements (but excluding equipment),associated production and exploration assets as defined in S.802.3(c), naturalresources and assets incidental to the ownership of the real property, that hasnot generated total revenues in excess of $5 million during the thirty-six (36)months preceding the acquisition."
I'm currently reviewing an acquisition in whichvarious real properties will be acquired from separate entities, which arecontrolled by a common ultimate parent entity. For purposes of determining ifthe greater than $5 million threshold under Section 802.2(c)(1) is met, is itnecessary to aggregate the revenues of all of the real properties held by theacquired person, i.e., the common ultimate parent entity, in the acquisition oris each real property valued individually to determine whether or not itindividually meets the threshold?
Any guidance that youmay be able to offer would be appreciated.