Question
October 13, 1995
VIA HAND DELIVERY
Mr. Richard B. Smith
Premerger Notification Office
Bureau of Competition
Federal Trade Commission
600 Pennsylvania Avenue, NW, Room 303
Washington, D.C. 20580
Re: Holding Company Formation - Reportability
under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, 15 U.S.C. 18a
(HSR Act)
Dear Dick:
This letter is to confirm our telephone conversation of October 3, 1995. In that conversation you advised that the consummation of the following transaction did not require HSR Act filings.
The proposed transaction involves the formation of a holding company. Corporation Xs outstanding voting securities are owned 75% by Corporation A and 25% by Corporation B. Corporations A and B propose to form a new company (Holding Co.) to which each will contribute 100% of the voting securities of Corporation X in exchange for the same number of Holding Co.s voting securities. No other assets or voting securities will be contributed to Holding Co. at its formation.
It is my understanding that even though A & B will acquire voting securities of a different issuer, the Premerger Notification Office (PNO) has interpreted 7(a)(c)(10) to exempt transactions such as the one described in this letter.
Based on the PNOs informal interpretation of 7(a)(c)(10), I will advise my client that it does not need to file an HSR Notification and Report Form in connection with the formation of Holding Co. and the transfer to it of Company Xs voting securities. Please advise me promptly if this letter misstates the PNOs position or your advice.
Thank you for your assistance in this matter.
Very truly yours,
(redacted)
cc: (redacted)