Question
November 19, 2007
VIA ELECTRONIC MAIL
KathrynE. Walsh
Federal Trade Commission
Room303
600 Pennsylvania Avenue, N.W.
Washington, D.C. 20580
Re: PotentiallyHSR Reportable Transaction
DearKate:
I am writing to inquire whetheror not you believe the transaction which I describe herein will be reportable pursuant to the provisions of theHart-Scott-Rodino Antitrust Improvements Act of 1976 (the "Act"). Thetransaction is described herein. Note that the names used in the followingdescription have been changed to maintain my clients' confidentiality.
ABC Organizational Structure
ABC, a limited partnership, owns 99.5% of the limitedpartnership interests of XYZ, a limited partnership. The remaining 0.5% generalpartnership interest in XYZ is owned by another limited liability company whichis the sole general partner of XYZ. ABC and XYZ are both privately-heldentities.
ABC also owns 99.99% of the limited partnershipinterests in ABC Holdings, a limited partnership. In turn ABC Holdings owns49.1% of the limited partnership interests in ABC EP, a publicly-traded masterlimited partnership. The remainder of limited partnership interests in ABC EPare held by the public. A 2% general partner interest in ABC EP is held by ABCEP, GP, a limited liability company, making ABC EP, GP the sole general partnerof ABC EP (all of the units in ABC EP, GP are held by ABC Holdings). Finally,ABC EP owns 100% of ABC EP Operating, a limited liability company, which inturn owns 100% of ABC EP, LLC, which is also a limited liability company. Ihave enclosed an illustration of the ABC organizational structure with thisemail for your benefit and review.
Proposed Transaction
In the proposed transaction, ABCEP, LLC will acquire certain assets belonging to XYZ. The transaction is not reportable under the Actpursuant to 16 C.F.R. 802.30(a). ABC is the ultimate parent entity of XYZ and ABC EP, LLC as itcontrols (as defined in 16 C.F.R. 801.1(b)) indirectly both XYZ and ABC EP, LLC. Thus XYZ and ABC EP, LLC are thesame person and thus the transfer of assetsbetween those 2 entities is not reportable for HSR purposes pursuant to802.30(a).
Please contact me when you have evaluated theproposed transaction and let me know if youconcur with my assessment of whether or not this transaction is reportable. Ilook forward to hearing from you. If you should have any questions,please do not hesitate to contact me.
Refer to image file for diagram.