8305007 Informal Interpretation

Date:
Rule:
801.11
Staff:
Dana Abrahamsen

Question

(redacted)

May 31, 1983

By Hand

Dana Abrahamsen, Attorney
Premerger Notification Office
Federal Trade Commission
Room 301
6th & Pennsylvania Avenue, N.W.
Washington, D.C. 20580

Dear Dana:

Set out below is my understanding of the position

of the Federal Trade Commission concerning the reporting

requirements under the Hart-Scott-Rodino Improvements Act

of 1976 with respect to acquisitions by newly-formed part-

nerships. This understanding is based on my previous con-

versations with you, including those of May 27th and May

31st, and other attorneys in the Premerger Notification

Office. As I understand it the Premerger Notification

Offices position is that a partnership is always its own

ultimate parent entity. Therefore, for the purposes of

measuring the size of the person test one looks to the

sales and assets of the partnership and not those of any

one or more of the partners. This is true even in the

case of a limited partnership where the general partner

(or partners) is a multi-billion dollar corporation. It

is also my understanding that when measuring the assets

of the newly-formed partnership, the consideration to be

paid to the selling entity in an acquisition is not in-

cluded in the calculation of the newly-formed partnerships

pro forma asset base.

Based on our conversations and my understanding of

the Premerger Notification Offices position, I advised

a client that a transaction involving the sale by that

client to a newly-formed partnership of assets valued at

more than thirty million dollars is not reportable since

the assets of the partnership calculated as described a-

bove are well under ten million dollars, Obviously, if

my understanding as set forth is in error, I need to know

immediately.

Thank you for you assistance in this matter. As

always, it is a pleasure dealing with you.

Very truly yours,

(Redacted)

(Redacted)

 

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