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Date

Tags:

Rule
801.2, 803.9
Staff
Timothy Carson
Response/Comments

Responses below corresponding to your questions:

1. Yes, but it generally avoids errors and confusion to submit a form for each UPE in this type of scenario

2. One filing fee is due on these facts

3. Break it out: 25% for each acquiring person

4. As a result of the transaction, A will hold 70% and B will hold 70%.

Question

From: Carson, Timothy


Sent: Wednesday, July 24, 2019 3:21:47 PM (UTC-05:00) Eastern Time (US & Canada)


To: [Redacted


Cc: [Redacted]


Subject: RE: Acquiring Entity HSR Question

Responses below corresponding to your questions:

1. Yes, but it generally avoids errors and confusion to submit a form for each UPE in this type of scenario

2. One filing fee is due on these facts

3. Break it out: 25% for each acquiring person

4. As a result of the transaction, A will hold 70% and B will hold 70%.

From: [Redacted]


Sent: Monday, July 22, 2019 12:08:24 PM (UTC-05:00) Eastern Time (US & Canada)


To: [Redacted]


Subject: Acquiring Entity HSR Question

Hi,

I have a question on HSR filings where the acquiring entity has two UPEs.

The facts are as follows:

· A is a foreign natural person. B is a foreign limited partnership. A and B each currently holds 25% of Company X.

· A and B have formed a NewCo in which each holds 50%. Thus, A and B are both NewCo’s UPEs.

· Shareholders C and D also currently each hold 25% of Company X.

· In the proposed transaction, NewCo will acquire 32.7% of Company X from Shareholders C and D. Company X will simultaneously buy back the remaining 17.3% of its own shares from Shareholders C and D.

· As a result of the transaction and buyback, NewCo will hold approx. 40% of the outstanding voting securities of Company X. A and B will each hold approx. 30% of the outstanding voting securities of Company X directly.

Questions:

1. It is our understanding that we can file a single Notification and Report Form on behalf of both A and B with NewCo as acquiring entity (see Informal interpretation 1311006). Please confirm.

2. Is the transaction subject to a single filing fee under 803.9(c)? Neither A nor B control any Item 6(a) entities other than NewCo. NewCo has no revenue. A (as a natural person) is reporting some interest/dividend income as Item 5 revenue. B is not reporting any Item 5 revenue. (Informal interpretation 1105001 suggests that even where the Item 5 information is not exactly the same, only one filing fee would apply in these circumstances.)

3. If reporting on a single HSR Form, how do we complete Item 2(d)(ii)? Do we aggregate A and B’s current holdings (i.e. 50% total), list 25% for each of A and B, or put 0%, which is how much NewCo currently holds?

4. Similarly, if reporting on a single HSR Form, for Item 2(d)(iv), do we aggregate A, B and NewCo’s resulting holdings (i.e. 100% total), list individually for A and B (70% each), or report only NewCo’s resulting holding (40%)?

 

About Informal Interpretations

Informal interpretations provide guidance from PNO staff on the applicability of the HSR rules to specific fact situations. They do not necessarily reflect the position of the Commission. You should not rely on them as a substitute for reading the Act and the Rules themselves. These materials do not, and are not intended to, constitute legal advice. 

Learn more about Informal Interpretations.