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LPC Law Notes Private Acquisitions Notes

Merger Control Letter Of Intent Ws 2 Prep Task And Ws Tasks Notes

Updated Merger Control Letter Of Intent Ws 2 Prep Task And Ws Tasks Notes

Private Acquisitions Notes

Private Acquisitions

Approximately 339 pages

A collection of the best Mergers and Acquisitions* notes the director of Oxbridge Notes (an Oxford law graduate) could find after combing through dozens of LPC samples from outstanding students with the highest results in England and carefully evaluating each on accuracy, formatting, logical structure, spelling/grammar, conciseness and "wow-factor".

In short, these are what we believe to be the strongest set of Mergers and Acquisitions notes available in the UK this year. This collection is f...

The following is a more accessible plain text extract of the PDF sample above, taken from our Private Acquisitions Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

1. Factors impacting on the method of sale:

  1. Mergers are regulated in the UK by the Enterprise Act 2002 (EA 2002). However, where European Regulation 139/2004 applies (ie where the merger has a ‘Community dimension’) this overrides the UK legislation, or that of any other EU Member State.

  2. There are two options for the sale, a Private Sale and an Auction Sale. The choice depends on whether:

  3. ¿Is it a Public or a Private Co.? This is a Private Company.

Auction Sale Private Sale

- By S.755(1) CA 2006 Private Co.’s cannot offer shares for sale to general public. BUT,

- By s.756(3) and advertisement issued to specifically identified B’s is the exception, BUT

- Note FSMA 2000

- there are no restrictions on the company to be sold in a private sale.
  1. ¿How quickly do they want to do it?

  2. ¿Are the potential buyers serious about the purchase?

  3. Confidentiality Agreement + Due Diligence

  4. Negotiating favourable terms within the SPA

2. Application of merger control regulation in the EU or the UK if the private sale proceeds:

  1. Apply the EU Test: The EU Merger Regulation 139/2004 will apply to anasset/share/merger purchaseof a Pub or Priv Co. if it constitutes a concentration with a Community dimension:

Say Apply Comment

¿Is there a Concentration?

Under Art. 3 of EU Reg. 139/2004

1. Merger of two or more independent undertakings:



2. Acquisition of direct/indirect control of the whole or part of an undertaking or undertakings:

  • Control means: more than just voting control it includes a situation where one party can exercise decisive influence over another (over 25% is being purchased)

  • Acquisition means:a direct financial purchase by contract, a purchase of shares or securitiesor any other resources.

¿Does The 2/3rdsRule apply?p.27 If the main impact 2/3rdsof the merger is within one Member State, it will not have a Community dimension. It may be caught by national competition rules. If the 2/3rdsrule applies the commission will not have jurisdiction. No


¿Is there a Community Dimension?

Art. 1 EU Reg. 139/2004

(apply both tests)

Test 1


Test 2

  1. The Aggregate Worldwide turnover of all the parties exceeds 5,000m; and

  2. The aggregate community-wide turnover of each of at least two of the parties exceeds 250m

  1. The aggregate worldwide turnover of all parties exceeds 2,500m;

  2. The aggregate community-wide turnover of each of at least two of the parties exceeds 100m; and

  3. In at least three Member States

  1. The aggregate turnover of all the parties exceeds 100m; and

  2. The aggregate turnover of each of at least two of the parties exceeds 25m

¿What do the parties want? The parties can request the European Commission to take jurisdiction over the transaction if the merger is capable of being reviewed under the national competition laws of at least three Member States No

¿Does UK Merger Control Apply?

Enterprise Act 2002 (EA 2002)

Apply all four steps.

  1. ¿Is it caught by the EU Merger Regulation above?

  1. s.129(1)EA¿Two or more enterprises cease to be distinct if either: ?

  • They are brought under common ownership or control; or

  • One ceased its business to prevent competition for the other.

  1. The time limit for a reference of the Competition Commission has not yet expired (4 months since the merger EA 2002 s.24); (i.e. if over 4 months have passed it will not be caught)

  1. …and either of these two tests is fulfilled:

Market Share Test: Merger results in at least 25% of all goods or services of a particular description which are supplied in the UK, or a substantial part of it, being supplied by or to the same person. (or if already over 25% then that the merger does not increase the existing market share) No (the 30% market share threshold will not increase as a result of the purchase. It will have to increase as a result of the purchase.
Turn Over Test: the value of the turnover in the UK of the enterprise being taken over exceeds 70m. No(the turn over in the UK is 32 m.)

Three Options:

1.It is not caught by either the EU or the UK competition regulation authorities; or

2. If the transaction is considered to be likely to be referred to the Competition Commission within the UK, the parties may try to seek “clearance” by serving a “merger notice” on the Office of Fair Trading OFT. The parties will be aiming to elicit formal confirmation that the transaction will not be referred to the Competition Commission. The notice works as safety net since the OFT’s failure to refer the merger to the Competition Commission within 20 days (may be extended 10 days), it will lose the right to make such a reference. The down side is that the merger has to be made public before serving the notice.

3.if the transaction has a EU dimension, the parties must notify the European Comission before completion. The merger cannot complet until the E Commission clears it. Comission has 25 days to say that a) it does not have jurisdiction, b) to clear it and c) to investigate and either clear, allow or block the merger.

US antitrust laws and other EU jurisdictional concerns We should advice the client that it will be necessary to check with local counsel whether the transaction is affected by US antitrust laws. Similarly, there may be other EU specific...

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