When to Aggregate under the HSR Act

The Hart-Scott-Rodino Act requires the aggregation of certain past acquisitions with current acquisitions.  The aggregation rules can be found in 16 CFR Sections 801.13, 801.14 and 801.15.  This overview outlines general aggregation principles and provides specific aggregation examples.

General Aggregation Principles

Always aggregate:

  • Acquisitions of voting securities, assets and controlling interests in non-corporate entities from the same acquired person in the same transaction.

Never aggregate:

  • Controlling interests in corporations or unincorporated entities that were previously acquired from the same acquired person as in the present transaction.
  • Previous acquisitions of voting securities that were exempt under the provisions listed in 801.15(a).

And remember...

  • Only acquisitions of non-corporate interests that confer control are reportable.

Specific Aggregation Scenarios

In these hypothetical examples, Company A holds part of Company B (voting securities, assets or non-corporate interests) and is buying something more from B. 

Scenario 1: A holds voting securities of B (or another issuer controlled by B)

  • If A is acquiring voting securities of B or another issuer controlled by B, aggregate.   
  • If A is acquiring assets of B, aggregate unless the prior voting securities acquisition was reported or was exempt under 802.21.
  • If A is acquiring non-corporate interests of an unincorporated entity controlled by B conferring control of that entity, aggregate.

Scenario 2: A holds (or has an agreement to acquire) assets it acquired from B

  • If A is acquiring voting securities of B, do not aggregate.
  • If A is acquiring assets of B, apply the 180 day rule in 801.13 to determine whether to aggregate.
  • If A is acquiring non-corporate interests of an unincorporated entity controlled by B conferring control of that entity, do not aggregate.

Scenario 3: A holds non-corporate interests of an unincorporated entity controlled by B

  • If A is acquiring voting securities of B, do not aggregate.
  • If A is acquiring assets of B, do not aggregate.
  • If A is acquiring additional non-corporate interests, aggregate if the non-corporate interests already held plus the non-corporate interests being acquired confer control.
  • If A is acquiring additional non-corporate interests (but not control) and A already holds voting securities of B (or another issuer controlled by B) or assets that it previously acquired from B, do not aggregate.