Agree. K Walsh concurs.
Friday, May 11, 2012 10:04 AM
Verne, B. Michael
HSR Size-of-Transaction - CONFIDENTIAL
Hopingyou can confirm some analysis for us:
Ourclient, Company A, plans to acquire 100% of the interests in Company B andCompany C. Company B is 100% owned by Person X and Person Y in equal, 50% shares.Company C is owned by Person X, Person Y and Person Z, also in equal shares(with no Person with the right to 50% or more of profits or assets upondissolution).
Takingeach acquisition separately, it is our understanding that, to the extent the size-of-personand size-of-transaction tests are met, Company A would have to file HSR foracquisition of 100% of Company B, with both Person X and Person Y filing asacquired UPEs (Le., both "control" Company B). It is also ourunderstanding that, to the extent the size-of-person and size-of-transactiontests are met, Company A would have to file HSR for acquisition of 100% ofCompany C, with Company C filing as its own UPE.
Theissue arises where neither transaction, taken separately, would meet the HSR size-of-transactiontest. Our question is whether the fact that Persons X and Y (the UPEs ofCompany B) are also selling their interests in Company C would somehow requirethat the value of the interests being sold by X and Y in Company B would needto be aggregated with those being sold by X and Y in Company C. Our reading ofOpinion 142 in the Premerger Notification Practice Manual (Fourth Edition)suggests that the common holdings of multiple seller UPEs need not beaggregated, and the acquisitions of Company B and Company C would not beaggregated for the size-of-transaction analysis (Le., these represent twodistinct transaction because they are purchases from distinct UPEs). Do youagree?
Pleaselet us know if you need any clarification or additional information.