Premerger clearance: No anticompetHive effects foreseeable

No. 164. Premerger clearance: No anticompetHive effects foreseeable. The Commission issued an aclvisory opinion on :l\lay 1:1:, 1964:, in which a request for premerger clearance from liability uncleI' Section 7 amended Clayton Act, was a.pproved permitting acquisition of a distributor by the manufacturer of products distributed. A franchised distributor of electrical equipment sought. cle,arance of its acquisition by the manufacturer or product:3 he distributed. Ths relationship bet,,-eeJl the fil'll1S had existed for many years -ras cancellable on 90 days notice , t11e trend In the line of business inyolyecl was to direct sales from manufacturer to purchaser and no substantia adverse competitive eire,ds \Vere foreseeable. The Commission advised the requesting party that the acquisition ,yould not vioh, te Coramission ac1ministerec11aw: hO\YeveJ.'~ he ,YD.') advised that the opinion was predic.ated on the understanding (1) tIll, t competing c1istributOl's would not be foreclosed Il'Grl1 supplies he c1i~~tributed and (2) that preexisteclrelationships between him and said supplier would not be altered ,,-ithont prior Commission a.ppro-':.-lL (File X 0. 643 '7c. , released Feb. 13 1968. No, 165, Premerger clearance: Deteriorating financial condition, The Commission issued an advisory opinion on July 30 ~ 196-:1:: in whic.h a request for premerger clearanc.e from liability under Section , amcl1.ded Clayton Ad as lapproyec1 perm.itting acCluisition of deteriorating competitor.

A national manufaetllre.r and distributor or COl1::mmer r!,'oocls soll~drt clearance of its propo:'3ec1 acquisition or a smaller manufacturer and distributor of the same products. ~iost of the businGs:3 of the sma.IIeI' firm was in fl, limited geographical area. The industry involved could be entered ,-..-ith a relatively modest S11m of 111one:\ . The firm to he acquired had experienced declining sales, a cletel'ionlting, nol1.viable, financial situation, personnel problems and had made reasonable but unsuccessful efforts to sell to others.

The Commission advised that basing its belief on the information currently available to it that the. proposed tl'allsactjon ~ if consummated, probably ,youlcl not violate any of the laws ,yhich the, Commission administers. (File. K o. 66:j 7003, reh~ased Feb. 13 1968.