Question
January 24, 2007
VIAE-MAIL AND U.S. MAIL
JamesH. Ferkingstad, Esq.
Premerger Notification Office
Bureau of Competition
Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, D.C. 20580
Dear Mr. Ferkingstad:
This letter confirms our telephoneconversation of January 18, 2007 concerning a proposed transaction between anonprofit hospital and a nonprofit hospital system which operates two hospitalsand a continuing care facility.
As we discussed, each party is a nonprofitcorporation under Section 501(c)(3) of the Internal Revenue Code. The twoparties propose forming a new nonprofit corporation which will become theparent of each of the parties. That new nonprofit corporation will qualify as anonprofit corporation under Section 501(c)(3) of the Internal Revenue Code. I am assuming, for purposes of this letter, that thetransaction would be reportable but for the possible exemption contained in 16 C.F.R. 802.40
You advised me that, because the two parties areconsolidating through the creation of a new nonprofit entity, the transactionis exempt from the filing requirements of the HSR Act under 16 C.F.R. 802.40.