FTC advisory opinion digest

No. 181. Compliance interpretation of requests for premerger cJearance: De minimis competitive effects; one request denied.

The Commission issued opinions on February 9, 1966 and January 26, 1967, in connection with requests for advice as to whether several proposed mergers, if consummated, ,\Quld be in violation of an outstanding Commission order prohibiting future acquisitions by respondent for a designated period of tinle ,,'ithout prior Commmission apPl'oyal.

A large automatic machine company under Commission order sought appI' o;-al for the proposed aequisition of hro snlaller, local companies enQ' ed in the same line of business. In O11e l1letl'onolitan a r('f( l'rsponc1eut and the first smaller company ITere in competition, and in the other trading area respondent and the second slnal1er company did not "rere a snb-compete to any significant degree. In the first area there stantinl number of local ::mc1national competitors involvec1~ and in the other area. fl. substantial number of local competitors and one national competitor were involved.

In these t'TO instances the Commission approved the proposed fl. different trac1inQ' area. the.acquisitions.In it third recmest for achice involving: respondent sought clearance for the proposed acquisition of a smaller local company engaged in the same line of business in direct competition with the larger company. There was a concentration in the line of commerce involved. The Commission denied the request for clearance because it was incompatible with the objectives of the order prohibiting such acquisitions. (File No. 809, released Feb. 13 1968. ) (Opinion issued under authority of Section 3. 61 (c) of the. Commission Rules of Practice (1967).

N Co 182. Compliance interpretation of request for premerger dearance: Liquidation probable.

The. Com.mission issued an opinion J\ia.y 24 , 1066, in connection "ith proposed acquisition, if consmn- a request for advice as to whether a \\

ADVISORY OPINION DIGEST 1303 mated, "\yould be in yiolation or an outstanding order prohibiting respondent. from making certain acquisitions for a designated period of time without prior Commission approval.

large manufacturel' or food pl'oclncts sol1g'ht clearance of its proposal to acquire a smaller manufacturer engaged in the same general line of commerce. The reclue-sting manufacturer "" , and is now, subject to a Commission order prohibiting, among other things the making of certain acquisitions for a designated period of time without prior Commission approval The b,o manufacturers "l\ere not in competition in the same ge.ogrftphical trading area, but to a very limited extent the requesting manufacturer was a supplier to the smaller company.

The smaller manufacturer had made reason:1 ble but unsuccessful attempts to sell to others in the industry and in the circmnstances liquidation appa,l'ently "l\as the only alternative to the proposed sale. The Commission advised that, in reliance on the information submitted by the parties, if the proposed acquisition was made , the Commission ",ouldnot proceed against the acquiring company. (File R o. D-7880, released Feb. 13 , IDG8. ) (Opinion issued uncleI' authority of Section 3.61(c) of the Commission s Rules of Practice (lD67).