Question
(redacted)
October 4, 1996
Richard Smith, Esq.
Premerger Notification Office
Bureau of Competition
Federal Trade Commission
600 Pennsylvania Avenue, NW, Room 303
Washington, D.C. 20580
Dear Mr. Smith:
This letter is to confirm your telephone conversation of yesterday with (redacted) of our firm concerning the reporting requirements under the Hart-Scott-Rodino Premerger Notification Act of the following transaction:
A merger agreement provides that Y will be merged into X with X as the surviving corporation. Each shareholder of Y will receive shares of X stock so that after the merger the Shareholders will own 91% of Xs voting stock. Y has an ultimate parent, B will also control, and thus include, X after the merger. A now owns 66% of the X shares and will own about 9% after the merger. As divestiture of X is the purpose of the merger.
Both in substance and under the rules the transaction would be treated as the acquisition of voting securities of X by B. B, now the controller of Y, will wind up controlling X. Under 16 C.F.R. 801.2(d)(l)(ii), B will be the person within which surviving corporation X is included after consummation and hence is the acquiring person. Since voting securities of A will be held by B after the transaction, A is the acquired person under 16 C.F.R. 801.2(d)(2)(ii). We have confirmed that no other person, including any current shareholder of Y, will hold 50% or more, or more than $15 million worth, of X voting securities as a result of the transaction. Accordingly, the only reporting persons are B as the acquiring person and A as the acquired person (but only with respect to X as to Items 5-9 of the form as provided by 803.2(c)).
Please contact me at your earliest convenience if this letter in some way does not reflect your offices understanding. We very much appreciate your assistance.
Sincerely yours,
(redacted)
Enclosure-approx. 20 pages.
(redacted)