This Act allows the federal government a chance to review a merger or acquisition between companies for their competitive impacts. When a company decides to merge or acquire one or more other companies, all the companies involved in the act have to submit filings with the federal government. After the filings have been submitted there is a 30-day waiting period in which the government decides whether to allow this merger based on any detrimental anticompetitive consequences of the act.
No, the federal government does not investigate every single merger and acquisition between companies, but rather this Act applies to merging or acquiring companies who meet the following criteria:
- One of the companies has to regularly engage in commerce, which virtually applies to all companies
- For one company, the company must have annual net sales of at least $100 million, or the group that has a controlling share of the company’s stock (50% or more) has to have more than $100 million in total assets
- For the other company, it must have annul net sales of at least $10 million, or the group with the controlling share of the company¿s stock must have over $100 million in total assets
- At least $15 million in assets or securities must be being acquired, or 15% of the voting securities are being acquired so that one company is gaining control of a part of a company or a company it did not previously have control over and that acquired entity¿s total assets or net sales are worth at least $25 million
You can consult an business attorney who has had experience with mergers and acquisitions. Your attorney will be able to give you advice and options concerning mergers and acquisitions, as well as help you out with all the legal formalities you will have to go through to properly conduct the process.