Question
(redacted)
Date:March 24, 1998
Fax to:Mr. Patrick Sharpe
FTC Premerger Office
202 326-2624
Dear Mr. Sharpe:
As I mentioned in my telephone message today, this is the same description which I sent you on March 12th on a no-name basis. With our clients approval and at their request, I am now able to substitute the names of the corporate entities and a description of the product area involved for the anonymous references contained in my earlier fax. In all other respects the description of the transaction remains the same as in my March 12th fax.
Corporations (redacted) and (redacted) each own 50% of the voting securities of joint venture corporation (redacted) S.A. which is engaged in the business of the manufacture and sale of hydrogen peroxide. (Redacted), (redacted) and (redacted) are all foreign persons, though that fact, as I understand it, is not relevant to conclusion (1.) below. (1.) (Redacted) will sell to (redacted) its full 50% ownership interest in (redacted). [ Staff comment: will acquire first] This transaction is exempt under 7A(c)(3) of the Statute. (2.) (Redacted) will also sell to (redacted) certain assets owned by (redacted) outside the joint venture corporation. [Staff comment: separate agreement ] Those assets located in the United States have a value less than $15 million and are thus exempt under 802.51(c) of the Rules.
Notwithstanding the provisions of 802.15 on aggregation of the purchases of voting securities and assets, the FTC takes the position that control under 7A(c)(3) terminates consideration of all aggregation issues. Therefore, the acquisition of the assets located in the United States can be considered entirely independently of the transaction by which the corporate joint venture terminates in the 7A(c)(3)- exempt transaction described in (1.) above.
In summary, the voting securities transaction and the asset transaction are not to be aggregated in determining whether reporting should occur. Because the assets to be acquired which are located in the United States have a value less than $15 million (and are, therefore, exempt under 802.51(c) absent aggregation considerations which are inapplicable for the reasons given above), no reporting of this transaction is required.
Best regards,
Sincerely,
(redacted)