Date
Rule
801.13(c)(1)
Response/Comments
801.13(c)(1) requires aggregation of the non-corporate interests already held with the non-corporate interests that are being acquired. It doesn't matter whether the acquisition is direct or indirect. The letter you reference is using some bizarre non-HSR math to determine the percentages held in the lowest level LLC. If you look at the schematic on the original image of the letter you can see that Investment Partnership holds nothing but minority interests in two LLCs, so nothing below those LLCs is held as a result of the acquisition. Also, using the proper HSR math you can see that U PE of Acquiror already holds 70% of the lowest level LLC, so even if it was acquiring additional interests in that LLC (which it is not), the transaction would be exempt under 802.30. I think my note, concurred with by Nancy, was written before we had all of the facts because some of the percentages in the schematic are in my handwriting.
File
Original Image File
(320.71 KB)
Question
From:
(Redacted)
Sent:
Tuesday, May 11, 2010 12:19 PM
To:
Verne, B. Michael
Subject: Non-corporate Interests
Mike,
Is the following scenario potentiallyreportable?
A holds 1/3 of the interests inPartnership X. B, a partnership, owns another 1/3 of Partnership X. B has no otherassets. A acquires more than 50% of the interests in B. Assume that size ofparties test is met and the value of 2/3 of B exceeds $63.4 million.
A's acquisition of B is exempt under802.4. Is B's indirect acquisition of control of X reportable? This informalinterpretation suggests that it is not reportable but the facts of thatinterpretation are not 100% clear: