A previous nugget discussed the Hart-Scott-Rodino Act, which requires that parties to a merger of a certain size report the transaction to the Federal Trade Commission and the Department of Justice prior to the closing. The Act applies to many midmarket transactions. Generally, to be a reportable merger, both a “size of person” and “size of transaction” test must be met. The dollar thresholds are adjusted each year. Earlier this year, the Federal Trade Commission announced the dollar thresholds that will apply in 2018. The size of person test is met if either the purchaser or seller has $168.8 million or more in annual sales or total assets, and the other party has $16.9 million or more in annual sales or total assets. The size of transaction test is met if the value of the seller is greater than $84.4 million. So, check if your transaction falls within the increased ranges discussed above. If it does, then the premerger notification rules apply.
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Glenn D. Solomon is a principal at Offit Kurman and has provided counsel to businesses and business owners for more than twenty-five years. He has extensive experience in the purchase and sale of businesses, structuring ownership agreements, and advising companies in financial distress.
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