DealLawyers.com Blog

Earlier this week, the FTC announced the new thresholds for HSR filings. This excerpt from Fenwick’s memo on the new thresholds has the details:

Size of Transaction Threshold. Under the new thresholds, the parties to a merger, consolidation, or acquisition of voting securities or substantial assets will, in most cases, need to file pre-acquisition notifications with the FTC and the DOJ and observe the HSR Act’s waiting periods before closing if the transaction will result in either of the following:

– The acquiring person will hold more than $111.4 million worth of voting securities and assets of the acquired person and the parties meet the “size of person” requirements below; or

– Regardless of the parties’ sizes, the acquiring person will hold more than $445.5 million worth of voting securities and assets of the acquired person (size of person test is not applicable).

Size of Person Threshold. Meeting any one of the following three subtests satisfies the size of person test:

– A person with $222.7 million or more of total assets (on its most recent regularly prepared balance sheet) or annual net sales (from its most recently completed fiscal year) proposes to acquire voting securities or assets of a person engaged in manufacturing (note that software is not considered manufacturing) with $22.3 million or more of annual net sales or total assets; or

– A person with $222.7 million or more of total assets or annual net sales proposes to acquire voting securities or assets of a person not engaged in manufacturing with $22.3 million or more of total assets (net sales test does not apply); or

– A person with $22.3 million or more of total assets or annual net sales proposes to acquire voting securities or assets of a person with $222.7 million or more of annual net sales or total assets.

The new thresholds and filing fees will take effect on February 24, 2023 (30 days after publication in the Federal Register).

– John Jenkins