During this webinar, Jon Dubrow, Greg Heltzer, Lisa Rumin, and Ryan Tisch provided a comprehensive introduction to the new Hart-Scott-Rodino (HSR) rules and their impact on the US premerger notification filing process. The program concluded with a Q&A moderated by Reese Poncia and featuring Ty Carson, a former Federal Trade Commission Premerger Notification Office lawyer, who shared his insider's perspective from six years with the agency.
Top takeaways included:
- Merging parties are required to submit substantially more information with the initial filing. Merging parties will need to collect and submit more documents with the initial filing, including transaction-related documents (formerly known as "Item 4" documents) from a "supervisory deal team lead" in addition to officers and directors, and ordinary course strategic documents on overlapping products. Additionally, parties will need to provide written descriptions of all transaction rationales considered and any overlaps or supply relationships between the parties. The filing is now an advocacy document requiring the parties to take positions on the level of competitive interaction between the parties and spotlight areas of overlap or vertical relationships.
- Antitrust must be considered earlier in the deal timeline. Competitive overlaps and vertical relationships need to be identified early on because they affect the scope of the filing. It is now critical to develop (with guidance from counsel) key themes about the deal rationale and implications on competition and ensure these themes are properly documented. Given that more time will be required to develop the HSR filing, purchase agreements are likely to include more flexible standards around timing to file.
- Companies can take steps today to make filings under the new rules less burdensome and increase the likelihood of achieving antitrust clearance. Frequent filers will want to begin collecting "off-the-shelf" information required by the new rules that can be useful for future filings which will vary based on the nature of the company and its M&A strategy. Antitrust training on document creation training should be offered to a wider range of employees that are involved in creating ordinary course strategic and business-planning documents.
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