Alert
Alert
02.01.12
On February 27, 2012, revised thresholds for the Hart-Scott Rodino Act (“HSR”) will take effect. The thresholds determine whether parties involved in proposed mergers, consolidations, or other acquisitions of voting securities, assets, or unincorporated interests must notify the Federal Trade Commission (“FTC”) and the Antitrust Division of the Department of Justice (“DOJ”) of a proposed transaction and comply with a mandatory waiting period before the transaction can be consummated.
HSR Thresholds Raised
The revised HSR thresholds reflect the adjusted jurisdictional requirements, based on the change in the gross national product, for determining whether a proposed transaction must be reported under HSR and, if so, the required filing fee. Generally, transactions will not be reportable under the new thresholds unless they are valued for HSR purposes at $68.2 million or more. If the value of the proposed transaction is at least $68.2 million but less than $283.6 million, the transaction will not be reportable unless the “ultimate parents” of the acquiring and the acquired firms also meet a certain minimum “size-of-person” test – in most instances, where one parent (including all entities it controls) has net sales or total assets of at least $13.6 million and the other has net sales or total assets of $136.4 million. Where the jurisdictional tests are met, the transactions are reportable unless an exemption applies. The table below includes the original and the new adjusted figures for each relevant HSR threshold. Parties should be mindful that there are many other factors that impact whether a given transaction is subject to the jurisdictional thresholds in addition to these dollar thresholds.
Original Threshold | Revised Threshold | Relevance |
---|---|---|
$10 million | $13.6 million | • Size-of-person test |
$50 million | $68.2 million | • Size-of-transaction test • Minimum HSR notification threshold • Foreign size of transaction exemption |
$100 million | $136.4 million | • Size-of-person test (B) • Intermediate HSR notification threshold |
$110 million | $150.1 million | • Foreign size of person exemption |
$200 million | $272.8 million | • Size-of-person test cap |
$500 million | $682.1 million | • Maximum HSR notification threshold |
$1 billion | $1,364.1 million (or $1.364 billion) | • 25% of voting securities valued at $1 billion notification threshold |
*The revised thresholds will take effect on February 27, 2012.
HSR Filing Fees
The filing fees for reportable transactions will be as follows:
Revised Thresholds for Interlocking Directorates
Section 8 of the Clayton Act generally prohibits companies that compete with each other from having interlocking memberships on their corporate boards of directors. The FTC annually revises the jurisdictional thresholds that trigger the interlocking directorate prohibition. The changes to the thresholds are based on the change in the gross national product and are effective immediately.
Download: HSR Thresholds Will Increase to Record Levels for Transactions in 2012