June 15, 1984
Office of Premerger Notification
Federal Trade Commission
Washington, D.C. 20580
Attn:Patrick Sharpe, Esq.
Dear Mr. Sharpe:
This letter will serve to follow our telephone conversation
today wherein I described the following transaction to you.
Corporation A, a company with over $100 million in net sales
or total assets, will sell certain assets to Corporation B
for approximately $42 million. Corporation B is a newly
formed corporation of which at least 60% percent of its
voting securities are owned by Corporation C. Corporation C
is also a newly formed corporation of which 100% of its
voting securities are owned by Limited Partnership which
has as its General Partner, an entity, whose ultimate parent
entity has over $10 million in net sales or total assets.
The partners, both general and limited, will contribute a
total of $5,000,000 of equity to the partnership: the partnership
will then purchase 100% of the stock of Corporation C which
will use that money to purchase at least 60% of the stock of
Corporation B. corporation B will use the $5,000,000 to
purchase the assets from Corporation A as well as Borrow
approximately $37 million from an unaffiliated financial
institution. This loan will be secured by the assets purchased
by Corporation B.
Limited Partnership d will not have funds over $10
million remaining after it purchases the stock of Corporation
C. Additionally, corporation C or B will no have $10
million after it purchases the assets from Corporation A
other than the assets held by Corporation B; essentially,
Corporation B will use all its paid-in capital to go as a
part payment for the assets of Corporation A.
We concluded that this transaction is not reportable
since the ultimate parent entity of the acquiring company is
Limited Partnership D and it does not meet the size-of-the-
person test under the Hart-Scoot-Rodino Rules and Regulations.
If this letter does not accurately reflect our telephone
conversation, please let me know.
With best regards.