The Federal Trade Commission (“FTC”) has announced its annual revisions to the thresholds governing the acquisition of certain voting securities and/or assets under the Hart-Scott-Rodino Antitrust Act Improvements Act of 1976 (the “HSR Act”), which will become effective on February 24, 2011. The FTC has also revised the thresholds that dictate under what conditions Section 8 of the Clayton Act will apply and thus prohibit an individual from serving as an officer and/or director of two competing corporations. The revised thresholds under Section 8 of the Clayton Act became effective on January 25, 2011.

I. HSR Act Thresholds

The two key thresholds that determine whether acquisitions are covered by the HSR Act relate to the “size of transaction” test and the “size of person” test. Effective February 24, 2011, the “size of transaction” test will increase from $63.4 million to $66.0 million and the “size of person” test will increase from $126.9 million to $131.9 million. Based on these new thresholds, certain acquisitions between parties engaged in commerce or in any activity affected by commerce will be covered by the HSR Act if, as a result of the transaction: (1) the acquiring person will hold an aggregate amount of voting securities, non-corporate interests and/or assets of the acquired person valued in excess of $66.0 million¹ and (2) one of the parties involved in the transaction has sales or assets of at least $131.9 million and the other party has sales or assets of at least $13.2 million. Parties involved in transactions covered by the HSR Act in which a filing is required may take advantage of the previous threshold amounts if such filing is submitted to the antitrust agencies prior to February 24, 2011.

II. Interlocking Director/Officer Thresholds

The two thresholds used to evaluate whether an individual will be prohibited from serving as an officer and/or director of competing corporations relate to (1) the capital, surplus and undivided profits of each competitor corporation and (2) the competitive sales of each corporation. Effective January 25, 2011, pursuant to the revised thresholds, an individual will be prohibited from serving as an officer and/or director of competing corporations, if each of two competing corporations individually have capital, surplus, and undivided profits aggregating more than $26,867,000 and the competitive sales of either corporation are greater than $2,686,700.

For further information regarding the matters discussed above or other antitrust related matters, please contact one of the attorneys listed below, or your regular Seward & Kissel attorney.