Sec. 802.20--Minimum dollar value.

An acquisition which would be subject to the requirements of the act and which satisfies section 7A(a)(3)(A), but which does not satisfy section 7A(a)(3)(B), shall be exempt from the requirements of the act if as a result of the acquisition the acquiring person would not hold:

(a) Assets of the acquired person valued at more than $15 million; or

 

(b) Voting securities which confer control of an issuer which, together with all entities which it controls, has annual net sales or total assets of $25 million or more.

 

Examples:

 

1. Acquiring person 'A' intends to acquire 66 percent of the voting securities of corporation X from X's ultimate parent entity, W, and 'A' holds no other assets or voting securities of acquired persons 'W'. X has no subsidiaries and does not have annual net sales or total assets of $10 million. If the postacquisition value of 'A' 's holdings of voting securities of X would be $15 million or less, the acquisition would be exempt under this section.

2. Assume that acquiring person 'B' holds voting securities of corporation Q valued at $9 million. 'B' now intends to acquire assets of Q valued at $7 million. Since the aggregate total amount of voting securities and assets of 'Q' to be held by 'B' would exceed $15 million, section 7A(a)(3)(B) would be satisfied, and the acquisition would not be exempt under this section.

3. Assume that acquiring person 'C' holds $5 million of the voting securities of corporation R, an entity included within person 'T.' 'C' now proposes to acquire $8 million of the assets of corporation S, also an entity included within person 'T,' representing 20 percent of 'T's' total assets. Section 7A(a)(3)(B) is not satisfied because the aggregate total amount of 'C's' holdings in acquired person 'T' will be less than $15 million. Although section 7A(a)(3)(A) would be satisfied by the asset acquisition, it will nevertheless be exempt under paragraph (a) of this section.

(43 FR 33544, July 31, 1978, as amended at 44 FR 66782, Nov. 21, 1979)

96/09/26