FEDERAL TRADE COMMISSION

FEDERAL TRADE COMMISSION

DEPARTMENT OF JUSTICE

BUREAU OF COMPETITION

ANTITRUST DIVISION

ANNUAL REPORT TO CONGRESS

FISCAL YEAR 2002

Pursuant to Subsection (j) of Section 7A of the Clayton Act

Hart-Scott-Rodino Antitrust Improvements Act of 1976

(Twenty-Fifth Report)

Timothy J. Muris

Chairman

Federal Trade Commission

R. Hewitt Pate

Assistant Attorney General

Antitrust Division

INTRODUCTION

The Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR Act” or the

“Act”), together with Section 13(b) of the Federal Trade Commission Act and Section 15 of

the Clayton Act, gives the Federal Trade Commission (the “Commission”) and the Antitrust

Division of the Department of Justice (the “Antitrust Division” or “Division”) the opportunity

to obtain effective preliminary relief against anticompetitive mergers and to prevent interim

harm to competition and consumers. The premerger notification program was instrumental in

detecting transactions that were the subject of the numerous enforcement actions brought in

fiscal year 2002 to protect consumers -- individuals, businesses, and government -- against

anticompetitive mergers.

Fiscal year 2002 marked the first full year of operation under the extensive reforms to

the HSR Act.1 The increase in the reporting thresholds inherently resulted in a decrease in the

number of reportable transactions as did the overall decline in merger activity from that of

recent years. (See Figure 1 below.) In fiscal year 2002, 1,187 transactions were reported

under the Act, representing about a 50 percent decrease from the number of transactions

reported in fiscal year 2001, and about a 76 percent decrease from the 4,926 transactions

reported in fiscal year 2000, the last full fiscal year under the previous reporting thresholds.2

HSR MERGER TRANSACTIONS REPORTED

FISCAL YEARS 1993 -2002

NUMBER OF TRANSACTIONS

6,000

4,728

5,000

4,642

4,926

3,702

4,000

2,816

3,000

3,087

2,305

2,376

1,846

2,000

1,187

1,000

FISCAL YEARS

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

Figure 1

During the year, the Commission challenged twenty-four transactions, leading to ten

consent orders, two administrative complaints, and seven abandoned transactions. The

1

Section 630 of the Department of Commerce, Justice, and State, the Judiciary, and Related Agencies

Appropriations Act, FY 2001, Pub. L. No. 106-553, 114 Stat. 2762. The legislation, which became effective

February 1, 2001, raised the size-of-transaction threshold from $15 million to $50 million and made other

changes to the filing and waiting period requirements.

2

See Appendix A.

1

Commission also authorized staff to seek injunctive relief in five matters, one of which was

filed in district court. Most notably, the Commission challenged the proposed merger of

Nestle Holdings, Inc., the world’s largest food producer, and Ralston Purina Company,3 the

world’s largest producer of dry pet foods. The merger would have eliminated direct

competition between the companies in the dry cat food market and increased the likelihood of

higher prices for consumers. The Commission also challenged the proposed merger of Valero

Energy Corporation and Ultramar Diamond Shamrock Corporation,4 which would have likely

increased the price of California Air Resources Board (“CARB”) gasoline for consumers in

California due to loss of competition from the merger.

The Antitrust Division challenged ten merger transactions, leading to two consent

decrees, two abandoned transactions, and five other transactions that were restructured after

the Division informed the parties of its antitrust concerns relating to the transaction. The

Division’s merger challenges included General Dynamics Corporation’s proposed acquisition

of Newport News Shipbuilding, Inc., which would have eliminated competition for nuclear

submarines and harmed competition for other military ships.5 The Division also challenged

Archer-Daniels-Midland Company’s proposed acquisition of Minnesota Corn Processors6

that, as originally structured, would have reduced the number of independent competitors in

the corn wet milling industry to four, making coordination among the remaining firms more

likely.

In fiscal year 2002, the Commission’s Premerger Notification Office (“PNO”)

continued to respond to thousands of telephone calls seeking information concerning the

reportability of transactions under the HSR Act and the details involved in completing and

filing the Notification and Report Form (“the filing form”). The HSR website,

www.ftc.gov/bc/hsr/, continued to provide improved access to information necessary to the

notification process. The website includes such information as the premerger notification

filing form and instructions, the premerger notification statute and rules, formal

interpretations of the rules, grants of early termination, filing fee instructions, HSR events,

tips for completing the filing form, procedures for submitting post-consummation filings,

frequently asked questions regarding the HSR filing requirements, and other useful

information. In particular, the website is the paramount source of information for HSR

practitioners seeking information on the changes to the Act and the premerger rules as a result

of last fiscal year’s HSR reform legislation, and includes Federal Register notices finalizing

the rules. A recent addition is a database of informal interpretation letters which provide PNO

staff interpretations of the premerger notification rules and the Act.

This fiscal year the PNO staff continued its outreach efforts by providing an in-depth

introductory seminar about the HSR filing requirements, specifically targeting new HSR

3

See infra p. 15.

4

See infra p. 16.

5

See infra p. 10.

6

See infra p. 10.

2

practitioners and others who are not familiar with the program, and incorporated those

seminar materials on the website.

BACKGROUND OF THE HSR ACT

Section 201 of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, Pub. L.

No. 94-435, amended the Clayton Act by adding a new Section 7A, 15 U.S.C. §18a.

Subsection (j) of Section 7A provides:

Beginning not later than January 1, 1978, the Federal Trade Commission, with

the concurrence of the Assistant Attorney General, shall annually report to

Congress on the operation of this section. Such report shall include an

assessment of the effects of this section, of the effects, purpose, and the need

for any rule promulgated pursuant thereto, and any recommendations for

revisions of this section.

This is the twenty-fifth annual report to Congress pursuant to this provision. It covers

fiscal year 2002 -- October 1, 2001 through September 30, 2002.

In general, the Act requires that certain proposed acquisitions of voting securities or

assets must be reported to the Commission and the Antitrust Division prior to consummation.

The parties must then wait a specified period, usually 30 days (15 days in the case of a cash

tender offer or a bankruptcy sale), before they may complete the transaction. Whether a

particular acquisition is subject to these requirements depends upon the value of the

acquisition and, in certain acquisitions, the size of the parties as measured by their sales and

assets. Small acquisitions, acquisitions involving small parties, and other classes of

acquisitions that are less likely to raise antitrust concerns are excluded from the Act’s

coverage.

The primary purpose of the statutory scheme, as the legislative history makes clear, is

to provide the antitrust enforcement agencies with the opportunity to review mergers and

acquisitions before they occur. The premerger notification program, with its filing and

waiting period requirements, provides the agencies with both the time and the information

necessary to conduct this antitrust review. Much of the information for a preliminary antitrust

evaluation is included in the notification filed with the agencies by the parties to the proposed

transactions and is immediately available for review during the waiting period.

However, if either agency determines during the waiting period that further inquiry is

necessary, it is authorized by Section 7A(e) of the Clayton Act to issue a request for

additional information and documentary material (“a second request”). The second request

extends the waiting period for a specified period after all parties have complied with the

request (or, in the case of a tender offer or a bankruptcy sale, after the acquiring person

complies). 7 This additional time provides the reviewing agency with the opportunity to

7

Under the statutory changes cited in footnote 1, this waiting period extension was increased to 30 days

for most transactions. The 10-day waiting period extension for cash tender offers and bankruptcies remains the

same.

3

analyze the information and to take appropriate action before the transaction is consummated.

If the reviewing agency believes that a proposed transaction may substantially lessen

competition, it may seek an injunction in federal district court to prohibit consummation of

the transaction.

The Commission, with the concurrence of the Assistant Attorney General,

promulgated final rules implementing the premerger notification program on July 31, 1978.

At that time, a comprehensive Statement of Basis and Purpose was also published, containing

a section-by-section analysis of the rules and an item-by-item analysis of the filing form. The

program became effective on September 5, 1978. The Commission, with the concurrence of

the Assistant Attorney General, has amended the rules and the filing form on several

occasions over the years to improve the program's effectiveness and to lessen the burden of

complying with the rules.8

A STATISTICAL PROFILE OF THE PREMERGER NOTIFICATION PROGRAM

The appendices to this report provide a statistical summary of the operation of the

premerger notification program. Appendix A shows, for a ten-year period, the number of

transactions reported,9 the number of filings received, the number of merger investigations in

which second requests were issued, and the number of transactions in which requests for early

termination of the waiting period were received, granted, and not granted. Appendix A also

shows for fiscal years 1993 through 2002 the number of transactions in which second requests

could have been issued, as well as the percentage of transactions in which second requests

were issued. Appendix B provides a month-by-month comparison of the number of

transactions reported and the number of filings received for fiscal years 1993 through 2002.

The statistics set out in these appendices show that the number of transactions reported

in fiscal year 2002 decreased approximately 50 percent from the number of transactions

reported in fiscal year 2001. In fiscal year 2002, 1,187 transactions were reported, while

2,376 were reported in fiscal year 2001. The statistics in Appendix A show that the number

of merger investigations in which second requests were issued in fiscal year 2002 decreased

approximately 30 percent from the number of merger investigations in which second requests

were issued in fiscal year 2001. Second requests were issued in 49 merger investigations in

8

43 Fed. Reg. 3443 (August 4, 1978); 43 Fed. Reg. 36053 (August 15, 1978); 44 Fed. Reg. (November

21, 1979); 45 Fed. Reg. 14205 (March 5, 1980); 48 Fed. Reg. 34427 (July 29, 1983); 50 Fed. Reg. 46633

(November 12, 1985); 51 Fed. Reg. 10368 (March 26, 1986); 52 Fed. Reg. 7066 (March 6, 1987); 52 Fed. Reg.

20058 (May 29, 1987); 54 Fed. Reg. 214251 (May 18, 1989); 55 Fed. Reg. 31371 (August 2, 1990); 60 Fed. Reg.

40704 (August 9, 1995); 61 Fed. Reg. 13666 (March 28, 1996); 63 Fed. Reg. 34592 (June 25, 1998); 66 Fed.

Reg. 8680 (February 1, 2001); 66 Fed. Reg. 8723 (February 1, 2001); 66 Fed. Reg. 16241 (March 23, 2001); 66

Fed. Reg. 23561 (May 9, 2001); 66 Fed. Reg. 35531 (July 6, 2001); 67 Fed. Reg. 11898 (March 18, 2002); 67

Fed. Reg. 11904 (March 18, 2002); 68 Fed. Reg. 2425 (January 17, 2003).

9

The term “transaction,” as used in Appendices A and B, and Exhibit A to this report, does not refer

only to separate mergers or acquisitions. A particular merger, joint venture or acquisition may be structured such

that it involves more than one transaction. For example, cash tender offers, options to acquire voting securities

from the issuer, or options to acquire voting securities from someone other than the issuer, may result in multiple

acquiring or acquired persons that necessitate separate HSR transaction numbers to track the filing parties and

waiting periods.

4

fiscal year 2002, while second requests were issued in 70 merger investigations in fiscal year

2001. While the number of second requests declined, the percentage of second request

transactions increased. (See Figure 2 below.)

PERCENTAGE OF TRANSACTIONS RESULTING

IN SECOND REQUEST

4.3%

4.5%

4.1%

3.8%

4.0%

3.5%

3.5%

3.1%

3.0%

2.6%

2.5%

2.0%

1.5%

2.7%

3.5%

1.0%

3.5%

2.1%

0.5%

0.0%

FISCAL YEARS

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

Figure 2

The statistics in Appendix A also show that in recent years, early termination was

requested in the majority of transactions. In fiscal year 2002, early termination was requested

in 87.8 percent (1,042) of the transactions reported while in fiscal year 2001 it was requested

in 86.8 (2,063) percent of the transactions reported. The percentage of requests granted out of

the total requested slightly decreased from 77.7 percent in fiscal year 2001 to 76.1 percent in

fiscal year 2002.

Statistical tables (Tables I through XI) in Exhibit A contain information about the

agencies’ enforcement activities for transactions reported in fiscal year 2002. The tables

provide, for various statistical breakdowns, the number and percentage of transactions in

which clearances to investigate were granted by one antitrust agency to the other and the

number of merger investigations in which second requests were issued. Table III of Exhibit A

shows that, in fiscal year 2002, clearance was granted to one or the other of the agencies for

the purpose of conducting an initial investigation in 18.3 percent of the total number of

transactions in which a second request could have been issued.

The tables also provide the number of transactions based on the dollar value of

transactions reported and the reporting threshold indicated in the notification report. The total

dollar value of reported transactions rose dramatically from fiscal years 1993 to 2000 from

about $222 million to about $3 trillion before declining to about $1 trillion in fiscal year 2001.

During fiscal year 2002, the dollar value of reported transactions fell to about $565.4 billion.

Tables X and XI provide the number of transactions in each industry group in which

the acquiring person or the acquired entity derived revenue. Figure 3 illustrates the

5

percentage of reportable transactions within industry groups for fiscal year 2002 based on the

acquired entity’s operations.

Other

17.7%

PERCENTAGE O F TRANSACTIO NS BY

INDUSTRY GRO UP O F ACQ UIRED ENTITY

FISCAL YEAR 2002

Manufacturing

22.8%

Health Services

2.4%

Chemicals and

Pharmaceuticals

5.9%

Banking/Insurance

11.0%

Transportation

0.8%

Consumer Goods

13.0%

Energy & Natural

Resources

10.8%

Information

Technology

15.6%

Figure 3

DEVELOPMENTS WITHIN THE PREMERGER PROGRAM

1. Final Rules

On February 1, 2001, the Commission, with the concurrence of the Assistant Attorney

General, published two Federal Register notices resulting in significant changes to the

premerger notification rules. These amendments were discussed in detail in the fiscal year

2001 Annual Report.10

The first 2001 Federal Register notice had published Interim Rules11 that became

effective on February 1, 2001, and incorporated the extensive statutory changes to the HSR

10

See the Annual Report to Congress, Fiscal Year 2001 for a detailed discussion of the substantive

11

The majority of the Interim Rules became final on January 17, 2003. 68 Fed. Reg. 2425. These

changes.

6

Act into the Premerger Notification Program. In fiscal year 2002, in response to public

comments, the Commission, with the concurrence of the Assistant Attorney General, modified

one of the Interim Rules. The final rule restored to parties who filed prior to February 1, 2001

the full five-year period following expiration of the waiting period to acquire up to the next

notification threshold that was in effect at the time of filing.12

The second 2001 Federal Register notice had set forth certain proposed amendments

that were not necessary to implement the HSR Act, but consisted instead of updates,

corrections and other improvements in the rules that the Commission determined were timely

and appropriate. These proposals had included modifying Section 802.2 by removing

associated agricultural assets from the agricultural property exemption, revising Section

802.6(b) regarding federal regulatory approval, and restructuring and revising Sections 802.50

and 802.51 to clarify and refocus exemptions for acquisitions of foreign assets and voting

securities. During fiscal year 2002, these amendments were finalized (with some changes in

response to public comment) and became effective on April 17, 2002.13

2. Compliance

The Commission and the Department of Justice continued to monitor compliance with

the premerger notification program’s filing and waiting period requirements and initiated a

number of compliance investigations in fiscal year 2002. The agencies monitor compliance

through a variety of methods, including the review of newspapers and industry publications

for announcements of transactions that may not have been reported in accordance with the

requirements of the Act. In addition, industry sources, such as competitors, customers and

suppliers, as well as interested members of the public, provide the agencies with information

about transactions and possible violations of the Act’s requirements. Under Section 7A(g)(1)

of the Act, any person that fails to comply with the Act’s notification and waiting

requirements is liable for a civil penalty of up to $11,000 for each day the violation

continues.14 In fiscal year 2002, corrective filings for thirteen transactions were received15

and one enforcement action was brought.

changes included implementing the increase in the size-of-transaction threshold and the introduction of a threetiered filing fee structure, and the elimination of Section 802.20 (which applied to acquisitions of 15% but valued

at $15 million or less), as well as updating the filing form.

12

67 Fed. Reg. 11904 (March 18, 2002).

13

67 Fed. Reg. 11898 (March 18, 2002).

14

Effective November 20, 1996, dollar amounts specified in civil monetary penalty provisions within

the Commission’s jurisdiction were adjusted for inflation in accordance with the Debt Collection Improvement

Act of 1996, Pub. L. No. 104-134 (April 26, 1996). The adjustments included, in part, an increase from $10,000

to $11,000 for each day during which a person is in violation under Section 7A(g)(1). 61 Fed. Reg. 54548

(October 21, 1996), corrected at 61 Fed. Reg. 55840 (October 29, 1996).

15

When the parties inadvertently fail to file, the enforcement agencies generally do not seek penalties

where the parties promptly make corrective filings after discovering the failure to file, submit an acceptable

explanation of their failure to file, and have not previously violated the Act.

7

In The Hearst Trust,16 the complaint alleged that Hearst failed to submit certain key

corporate documents that were required for premerger notification review under the HSR Act

before acquiring Medi-Span, Inc. in 1998, and that the failure to submit these documents

hindered the ability of the federal antitrust agencies to analyze the competitive effects of the

acquisition prior to consummation. Hearst’s acquisition of Medi-Span, its main competitor in

the market for electronic integratable drug information databases, also known as integratable

drug data files, allowed Hearst’s First DataBank, Inc. subsidiary to institute substantial price

increases to its customers for use of the electronic databases which contain clinical, pricing

and other information on prescription and non-prescription drugs. Pharmacists, physicians,

hospital staff, and health plans use these databases to help them provide high-quality, costeffective patient care. Most notably, integratable drug data files are needed for pharmacists to

get quick, automatic warnings of any dangerous interactions between newly prescribed drugs

and other drugs their patients are already taking. A consent decree that was filed

simultaneously with the complaint and entered by the court on October 15, 2001 required

Hearst to pay $4 million in civil penalties, as of then the largest amount paid by a single

company for a violation of the premerger notification law.

MERGER ENFORCEMENT ACTIVITY17

1.

The Department of Justice

During fiscal year 2002, the Antitrust Division challenged ten merger transactions that

it concluded may have substantially lessened competition if allowed to proceed as proposed.

In four of these transactions, the Antitrust Division filed a complaint in U.S. district court.

Two of these cases were settled by consent decree; one transaction was abandoned after filing

the complaint; and one case was litigated unsuccessfully in district court. In the six other

challenges during fiscal year 2002, the Antitrust Division informed the parties to a proposed

transaction that it would likely file suit challenging the transaction unless the parties

restructured the proposal to avoid competitive problems or abandoned the proposal

altogether.18 In five of these proposed transactions, the parties restructured the transactions;

16

United States v. The Hearst Trust and The Hearst Corporation, Civil No. 1:01CV02119 (D.D.C.

complaint filed October 11, 2001).

In Federal Trade Commission v. The Hearst Trust, Civ. No. 1:01CV00734 (D.D.C. complaint filed

April 5, 2001), the Commission filed for a permanent injunction alleging that Hearst and First DataBank illegally

acquired a monopoly in the market for electronic integratable drug information drug data files. On December 14,

2001, the Commission voted to approve a proposed settlement that required Hearst to divest the former MediSpan business and pay $19 million as disgorgement of unlawful profits. The settlement marks the first time the

Commission has sought either divestiture or disgorgement of profits in a federal court action for a consummated

merger. The funds were required to be distributed to injured customers as part of the settlement of a private class

action suit alleging unlawful overcharges by Hearst. The district court approved the final order and stipulated

permanent injunction on December 18, 2001. See Annual Report to Congress, Fiscal Year 2001at 19-20.

17

All cases in this report were not necessarily reportable under the premerger notification program.

Because of provisions regarding the confidentiality of the information obtained pursuant to the Act, it would be

inappropriate to identify which cases were initiated under the program.

18

In four instances, the Department of Justice issued press releases: November 29, 2001 B Wells Fargo

8

and in one, the parties abandoned the proposed transaction entirely.

In United States v. SunGard Data Systems, Inc. and Comdisco, Inc.,19 the Division

sued to prevent SunGard from acquiring Comdisco and consequently reducing competition

substantially in the sale of shared hot site disaster recovery services provided to consumers in

the event of an interruption of a computer data center due to an incapacitating event. The

companies were two of three major suppliers of shared hot site services for data recovery. For

many customers, SunGard and Comdisco were the closest and best competitive alternatives,

based upon considerations of hot site systems offerings, service, and price. After Comdisco

filed voluntary Chapter 11 bankruptcy, SunGard offered the highest bid at the auction for the

Comdisco assets. The Division sued to block the transaction in the U.S. District Court for the

District of Columbia on October 23, 2001. On November 14, 2001, after an expedited trial,

the district court entered judgment for the defendants, denied the Division's request for

permanent injunction, and dismissed the complaint with prejudice.

In United States v. General Dynamics Corporation and Newport News Shipbuilding

Inc., the Division challenged General Dynamics' $2.6 billion acquisition of Newport News,

alleging that the cash tender offer, as originally proposed, would eliminate competition for

nuclear submarines B a weapon platform of vital importance to the security of the United

States B resulting in a monopoly. General Dynamics and Newport News were the only

manufacturers of nuclear submarines. The companies were also leaders on the only two

teams working to develop electric drive technology for nuclear submarines and surface

combatants. The merger, as structured, also would have harmed competition for the

manufacture of other military ships, including conventionally powered surface combatants.

The parties abandoned their merger agreement on October 29, 2001.

20

In United States v. The Manitowoc Company, Inc., Grove Investors, Inc. and National

Crane Corporation,21 the Division challenged The Manitowoc Company's $170 million

and Company merger with Texas Financial Bancorporation, Inc. and its acquisition of certain bank and non-bank

subsidiaries of Marquette Bancshares, Inc. B Minnesota and South Dakota banks (business banking services);

December 3, 2001 B SunTrust Bank's acquisition of Huntington National Bank B Florida banks (business banking

services); December 18, 2001 B Suiza Foods Corporation and Dean Foods Company merger (dairy processing

plants in Alabama, Florida, Indiana, Kentucky, Ohio, South Carolina, Virginia and Utah); September 6, 2002 B

Aggregate Industries' acquisition of Wakefield Materials Company (ready-mix concrete facility serving northern

metropolitan Boston).

In the remaining two challenges, the Division informed the parties of its antitrust concerns but did not

issue a press release: American General Media Corp.’s proposed acquisition of Rocky Mountain Broadcasting I,

L.L.C. and Salisbury Broadcasting's acquisition of Mass Entertainment Corporation (Aspen and Vail, Colorado

radio stations); Oldcastle Materials Group's acquisition of Aggregate Industries' Central Region ((Michigan and

Indiana) (aggregate, asphalt and ready-mix concrete facilities)).

19

United States v. SunGard Data Systems, Inc. & Comdisco, Inc., No.01-2196 (ESH) (D.D.C. Oct. 22,

2001).

20

United States v. General Dynamics Corp. & Newport News Shipbuilding Inc., No.1:01CV02200

(D.D.C. Oct. 23, 2001).

21

United States v. The Manitowoc Co., Inc., Grove Investors, Inc. & National Crane Corp., No.

9

acquisition of Grove Investors. The complaint alleged that the acquisition, as originally

proposed, would have reduced competition by combining two of only three major producers

of medium- and heavy-lift boom trucks in North America. A boom truck is a stiff boom

telescopic crane mounted on a standard flat-bed commercial truck chassis. This generalpurpose mobile crane has a broad range of applications in the construction, petroleum, and

utility industries. The Division filed a proposed consent decree simultaneously with the

complaint, settling the suit. Under the terms of the decree, Manitowoc was required to divest

either its own or Grove's boom truck business to a purchaser acceptable to the Division. The

Court entered the consent decree on December 11, 2002.

In United States v. Archer-Daniels-Midland Company and Minnesota Corn

Processors,22 the companies agreed to dissolve a joint venture with a competing corn wet

miller in order for ADM to proceed with its $634 million proposed acquisition of MCP.

ADM and MCP were two of the largest wet corn millers in the United States. The complaint

alleged that the acquisition, as originally structured, would have lessened competition

substantially by reducing the number of independent competitors in the corn wet milling

industry to four and making coordination among the remaining firms more likely. The wet

mill processing of corn results in the manufacture of corn syrup and high fructose corn syrup

(“HFCS”), products found in foods and soft drinks. Americans consume over $2.5 billion in

corn syrup and HFCS each year. The Division filed a proposed consent decree

simultaneously with the complaint, settling the suit. The decree required ADM and MCP to

dissolve the joint venture between MCP and Corn Producers International, Inc. (“CPI”),

allowing CPI to compete independently of the merged ADM and MCP. The Court entered the

consent decree on July 22, 2003.

During fiscal year 2002, the Division investigated four bank merger transactions for

which divestiture was required prior to or concurrently with the acquisition and two others in

which conditions were imposed. A Anot significantly adverse@ letter conditioned upon a letter

agreement between the parties and the Division was sent to the appropriate bank regulatory

agency in all instances.23 Also during fiscal year 2002, courts entered consent decrees in two

02CV0159 (D.D.C. July 31, 2002).

22

United States v. Archer-Daniels-Midland Co. & Minnesota Corn Processors, No. 1:02CV01768

(D.D.C. Sept. 6, 2002).

23

The six letters were: October 4, 2001 letter to the Comptroller of the Currency regarding the

application by Community Bank, N.A., Canton, NY, to acquire 36 branches of Fleet National Bank, Providence,

RI; October 15, 2001 letter to the Comptroller of the Currency regarding the application for NBT Bank, N.A.,

Norwich, NY, to acquire Central National Bank, Canajoharie, NY; November 29, 2001 letter to the Board of

Governors of the Federal Reserve System regarding the application by Wells Fargo & Company, San Francisco,

CA, to acquire certain bank and non-bank subsidiaries of Marquette Bancshares, Inc., MN, and to merge with

Texas Financial Bancorporation, TX (the Pohlad Group); December 3, 2001 letter to the Board of Governors

regarding the application by SunTrust Bank, Atlanta, GA, to acquire Florida branches of Huntington Bank,

Columbus, OH; December 26, 2001 letter to the Board of Governors of the regarding the application by

Wesbanco, Inc., Wheeling, WV, to acquire American Bancorporation, Wheeling, OH, and to merge Wheeling

National Bank, Wheeling, WV, into Wesbanco Bank, Wheeling, WV; August 8, 2002 letter to the Federal

Deposit Insurance Corporation regarding the application by S&T Bank, Indiana, PA, to acquire PFC Bank, Ford

City, PA, as part of a transaction wherein S&T Bancorp, Inc. acquired Peoples Financial Corp.

10

merger cases previously filed by the Division in fiscal year 2001.24

Additionally, on September 10, 2002, in United States v. Earthgrains Co., Specialty

Foods Corp. and Metz Holdings, Inc. (N.D. Ill.), the Division petitioned the Court to find

Earthgrains Baking Companies, Inc., successor in interest to Earthgrains Company, in civil

contempt for violating an order that had been entered by the court on July 3, 2000.25

According to the motion, Earthgrains violated the consent decree by failing to maintain assets

prior to their divestiture, as required by the Hold Separate Stipulation and Order. To resolve

the matter, Earthgrains agreed to pay a $100,000 civil penalty to the United States.

2.

The Federal Trade Commission

The Commission challenged twenty-four transactions that it concluded would lessen

competition if allowed to proceed as proposed during fiscal year 2002,26 leading to ten

consent orders, two administrative complaints, and seven withdrawn filings. In five of the

twenty-four matters, the Commission authorized staff to seek injunctive relief; of these, one

case was filed in district court and after a preliminary injunction was granted the parties

abandoned the transaction, in two cases the parties negotiated a consent agreement, and in two

other cases the parties abandoned the transaction.

In Diageo plc/Vivendi Universal S.A.,27 the Commission authorized staff to file for a

preliminary injunction to block Diageo’s and Pernod Ricard S.A.’s proposed $8.15 billion

joint acquisition of Vivendi’s Seagram Wine and Spirits business. According to the

complaint, the proposed acquisition would have substantially lessened competition in five

relevant product markets in the distilled spirits industry. Specifically, the rum market would

have become a duopoly controlled by Bacardi U.S.A., the industry leader, and

Diageo/Seagram, the second and third largest sellers of rum in the United States. Together,

Bacardi U.S.A. and Diageo/Seagram would have controlled 95 percent of all premium rum

sales in the United States. The next largest competitor would have a market share in the

United States of about only two percent. Diageo would have also acquired highly sensitive

commercial business information about Seagram’s Gin, its principal competitor in the retail

gin market. Prior to the Commission’s filing of a complaint seeking the preliminary

injunction, a proposed consent agreement was negotiated that allowed the parties to proceed

with the transaction under certain conditions. The order required Diageo to divest its Malibu

24

On April 5, 2002, the District Court entered the consent decree in United States v. Premdor, Inc.,

Premdor U.S. Holdings, Inc., Int'l Paper Co. & Masonite Corp. (D.D.C. Aug. 3, 2001); on April 17, 2002, the

consent decree was entered in United States v. 3D Systems Corp. & DTM Corp. (D.D.C. Aug. 16, 2001). See

the Annual Report to Congress, Fiscal Year 2001 for a description of these cases.

25

See the Annual Report to Congress, Fiscal Year 2000 for a description of this case.

26

In addition to the two administrative complaints discussed on page 14 of this report, an administrative

complaint was also issued in Libbey Inc./Newell Rubbermaid, Inc. (See the above discussion). To avoid double

counting this report includes only those merger enforcement actions in which the Commission took its first public

action during fiscal year 2002.

27

Diageo plc/Vivendi Universal S.A., Docket No. C-4032 (issued February 4, 2002).

11

Rum assets, the country’s leading coconut-flavored rum, to a Commission-approved buyer

and agree not to obtain or use any commercially sensitive business information regarding four

brands, including Seagram’s Gin, that were to be acquired by Pernod.

In Libbey, Inc./Newell Rubbermaid, Inc.,28 the Commission filed for a preliminary

injunction in district court alleging that Libbey’s proposed acquisition of Newell

Rubbermaid’s Anchor Hocking Corporation subsidiary would have substantially lessened

competition in the market for soda-lime glassware sold to the food service industry in the

United States. According to the complaint, the acquisition would have combined the largest

and third-largest sellers of soda-lime glassware to the United States food service industry.

The acquisition would have eliminated substantial competition between Libbey and Anchor,

increased barriers to entry into the relevant market and increased the likelihood of higher

prices for consumers. In April 2002, the court granted the Commission’s motion blocking the

proposed acquisition. Following the court’s preliminary injunction order, in May 2002 the

Commission issued an administrative complaint against the parties. The parties subsequently

abandoned the transaction.

In Deutsche Gelatine-Fabriken Stoess AG/Goodman Fielder Limited,29 the

Commission authorized staff to file for a preliminary injunction to block the proposed

acquisition by DGF Stoess of Goodman Fielder’s gelatin business. According to the

complaint, DGF Stoess and Goodman Fielder were the two largest producers of pigskin and

beef hide gelatin in the world. Pigskin and beef hide gelatin are used primarily by the food

industry as an ingredient in edible products and by the pharmaceutical industry to produce

capsules and tablets. The proposed acquisition would have further consolidated an already

concentrated market and increased the likelihood that customers of pigskin and beef hide

gelatin would be forced to pay higher prices. Prior to the Commission’s filing of a complaint

seeking the preliminary injunction, a proposed consent agreement was negotiated to remedy

the alleged anticompetitive effects of the merger. Under the terms of the agreement, DGF

Stoess could not acquire Goodman Fielder’s entire gelatin business; rather, Leiner Davis

Gelatin Corporation, a Goodman Fielder subsidiary, would retain its United States and

Argentine gelatin plants and related assets.

In Meade Instruments Corporation/Tasco Holdings, Inc.,30 the Commission authorized

staff to file for a preliminary injunction in federal district court to pre-empt any attempt by

Meade to purchase assets of bankrupt Tasco Holdings, Inc.’s Celestron International

subsidiary. According to the complaint, Meade was the leading manufacturer of performance

telescopes and Schmidt-Cassegrain telescopes in the United States, with dominant positions in

28

Federal Trade Commission v. Libbey, Inc., Civ. No. 02-0060 (D.D.C. complaint filed January 14,

2002). On June 10, 2002, the respondents announced that they had terminated their merger agreement. On

October 7, 2002, the Commission issued a consent order in settlement of the accompanying administrative

proceedings (Docket No. 9301).

29

Deutsche Gelatine-Fabriken Stoess AG/Goodman Fielder Limited, Docket No. C-4045 (issued April

17, 2002).

30

Meade Instruments Corporation/Tasco Holdings, Inc., File No. 021-0127.

12

the markets for performance and Schmidt-Cassegrain telescopes. Celestron International was

the number two performance telescope provider in the United States and the only other

supplier of Schmidt-Cassegrain telescopes. The acquisition would have adversely impacted

the performance telescope market by eliminating competition between the two companies and

by creating a monopoly in the market for Schmidt-Cassegrain telescopes. In May 2002,

Meade notified the Commission that it had abandoned its efforts to bid for the Celestron

assets.

In Cytyc Corporation/Digene Corporation,31 the Commission authorized staff to seek

a preliminary injunction to block Cytyc’s proposed acquisition of Digene. According to the

complaint, the combination of the two companies would have lessened competition and

increased consumer prices within the highly concentrated market for primary cervical cancer

screening tests. Both Cytyc and Digene manufactured and sold products used to screen

women for cervical cancer. Cytyc’s products accounted for 93 percent of the U.S. liquidbased pap tests, the most widely used sensitive primary screening tool available for the

detection of cervical cancer. The only other company producing and selling an FDAapproved liquid pap test in the United States was TriPath Imaging. While three other

companies had developed such tests, they had not yet begun clinical trials, and were at least

two years away from entering the U.S. market. Digene was the only company in the United

States selling a DNA-based test for the human papillomavirus (“HPV”), believed to cause

nearly all cervical cancer cases. Digene’s HPV test is most commonly and efficiently

conducted using a residual sample obtained from a liquid pap test, which requires FDA

approval. Thus, it is important that a company manufacturing liquid pap tests have FDA

approval to run the Digene HPV test off its sample medium. It is similarly important that a

liquid pap test supplier’s customers have viable access to Digene’s HPV test. By purchasing

Digene, Cytyc would have been in a position to eliminate its only existing competitor,

TriPath, by limiting access to Digene’s HPV test, and thus, could have thwarted the entry of

other firms that planned to sell liquid pap tests in the United States. The parties abandoned

the transaction prior to the Commission’s filing of the complaint in district court.

The Commission issued an administrative complaint in MSC.Software Corporation,32

alleging that MSC’s 1999 acquisitions of Universal Analytics, Inc. (“UAI”) and

Computerized Structural Analysis & Research Corporation (“CSAR”) substantially lessened

competition in the market for a popular type of advanced computer-aided engineering

software used throughout the aerospace and automotive industries known as Nastran.

According to the complaint, MSC was the dominant Nastran supplier with an estimated 90

percent of worldwide revenue and UAI and CSAR, each, held an estimated five percent of

worldwide revenue. The acquisitions created and enhanced MSC’s power to raise prices

above a competitive level and prevented other suppliers of engineering software form

acquiring UAI and CSAR and increasing competition. Subsequently, the matter was

withdrawn from adjudication and a consent agreement was negotiated. The order required

MSC to divest at least one clone copy of its current advanced Nastran software, including the

31

Cytyc Corporation/Digene Corporation, File No. 021-0098.

32

MSC.Software Corporation, Docket No. 9299 (issued October 9, 2001).

13

source code. In addition, MSC was required to permit certain customers to terminate paid-up

licenses entered into since the acquisitions and required MSC to refund a portion of the

advance consideration paid by its customers.

The Commission also issued an administrative complaint in Chicago Bridge & Iron

Company N.V., Chicago Bridge & Iron Company, and Pitt-Des Moines, Inc.,33 alleging that

CB&I’s 2001 acquisition of the Water Division and Engineered Construction Division of PittDes Moines, Inc. (“PDM”) substantially lessened competition in four relevant specialty

industrial storage tank markets. According to the complaint, CB&I and PDM competed

against each other as the two leading U.S. producers of large, field-erected industrial and

water storage tanks and other specialized steel-plate structures. The combination of the two

companies resulted in a monopoly in the U.S. markets for two of the more difficult and costly

products to construct – LNG tanks and thermal vacuum chambers. In addition, the

combination of the two companies resulted in a dominant firm in the U.S. markets for LPG

tanks and LIN/LOX/LAR tanks. On June 18, 2003, in an Initial Decision, the administrative

law judge upheld the administrative complaint allegations. The order entered by the judge

required CB&I to divest all of the assets acquired in the February 2001 acquisition, in order to

restore competition as it existed prior to the acquisition.

In fiscal year 2002, the Commission accepted consent agreements for public comment

in ten merger cases. A complaint and decision and order were issued in eight of these matters

during the fiscal year, and a consent agreement in two of these cases became final after

September 2002.

In Airgas, Inc.,34 the complaint alleged that Airgas’s purchase of the Puritan Bennett

Medical Gas business from Mallinckrodt, Inc. in January 2000 had an adverse effect on

competition in the nitrous oxide market in the United States and Canada. Nitrous oxide is a

clear, odorless gas primarily used in dental and surgical procedures as an analgesic agent or as

a supplement to anesthesia. At the time of the acquisition, Puritan Bennett was Airgas’s only

competitor in the production and sale of nitrous oxide. Airgas was the nation’s largest

distributor of industrial, medical, and specialty gases and the only producer and seller of

nitrous oxide in North America. Puritan Bennett, prior to its $90 million purchase by Airgas,

was a leading distributor of medical gases and a producer and seller of nitrous oxide in North

America. The acquisition eliminated any competition in this market in North America and

increased the likelihood that customers requiring nitrous oxide would pay higher prices.

Under the agreement, Airgas was required to divest a nitrous oxide business to Air Liquide

America Corporation, a producer of other medical gases, such as medical grade oxygen and

nitrogen. The agreement also required Airgas to supply Air Liquide with a sufficient amount

of bulk liquid nitrous oxide in order to ensure that Air Liquide has the same volume of nitrous

oxide as Airgas did before its acquisition of Puritan Bennett.

33

Chicago Bridge & Iron Company N.V., Chicago Bridge & Iron Company, and Pitt-Des Moines, Inc.,

Docket No. 9300 (issued October 25, 2001).

34

Airgas, Inc., Docket No. C-4029 (issued December 12, 2001).

14

In Koninklijke Ahold NV/Bruno’s Supermarkets, Inc.,35 the complaint alleged that

Ahold’s proposed purchase of Bruno’s Supermarkets would have substantially lessened

competition in the retail sale of food and grocery items in supermarkets in or near the towns

of Milledgeville and Sandersville, Georgia. According to the complaint, Ahold, a global food

service distributor and retailer, operated approximately 1,300 United States food stores under

the trade names Giant, Stop & Shop, Tops, and BI-LO. Bruno’s Supermarkets, a large

supermarket chain in the southeastern United States, owned 169 supermarkets under the trade

names Bruno’s Fine Foods, Food World, Food Max, Food Fair, and Fresh Value. The order

required Ahold to divest two of its BI-LO supermarkets in Georgia, one in Milledgeville and

one in Sandersville.

In Nestle Holdings, Inc./Ralston Purina Company,36 the complaint alleged that

Nestle’s proposed $10.3 billion acquisition of Ralston would have substantially lessened

competition in the dry cat food market in the United States. According to the complaint, the

proposed transaction would have substantially increased concentration in the relevant market,

eliminated direct competition between the companies, and increased the ability of the

combined company to unilaterally exercise market power, thereby increasing the likelihood

that consumers would pay higher prices. Nestle, the largest food corporation in the world,

sells its pet food products through its Friskies Pet Care Division, including Alpo, Come N’

Get It, Mighty Dog, Friskies, Fancy Feast, Jim Dandy, and Chef’s Blend. Ralston, the

world’s leading producer of dry pet foods, markets brands such as Dog Chow, Puppy Chow,

Cat Chow, Kitten Chow, Purina Special Care, Meow Mix, Purina O.N.E., Purina Pro Plan, Fit

& Trim, Alley Cat, and Deli-Cat. Under the order, Nestle was required to divest Ralston’s

Meow Mix and Alley Cat brands to J.W. Childs Equity Partners II, L.P., which owns Hartz

Mountain, a leading manufacturer and distributor of pet supplies in the United States.

In Valero Energy Corp./Ultramar Diamond Shamrock Corp.,37 the complaint alleged

that the proposed merger of petroleum refiners Valero and Ultramar would have substantially

lessened competition in the following markets: 1) the refining and bulk supply of California

Air Resources Board (“CARB”) 2 and CARB 3 gasoline for sale in Northern California and

2) the refining and bulk supply of CARB 2 and CARB 3 gasoline in the state of California.

According to the complaint, both Valero and Ultramar were leading refiners and marketers of

CARB gasoline in California and by eliminating the direct competition between the parties

the merger would have likely increased the price of CARB gasoline for consumers in

California due to loss of competition from the merger. The order required Valero to divest

Ultramar’s Golden Eagle Refinery, certain bulk gasoline supply contracts, and 70 Ultramar

retail service stations in Northern California to a Commission-approved buyer.

In INA-Holding Schaeffler KG/FAG Kugelfischer Georg Schafer AG,38 the complaint

35

Koninklijke Ahold NV/Bruno’s Supermarkets, Inc., Docket No. C-4027 (issued January 16, 2002).

36

Nestle Holdings, Inc./Ralston Purina Company, Docket No. C-4028 (issued February 4, 2002).

Valero Energy Corp./Ultramar Diamond Shamrock Corp., Docket No. C-4031 (issued February 19,

37

2002).

38

INA-Holding Schaeffler KG/FAG Kugelfischer Georg Schafer AG, Docket No. C-4033 (issued

February 5, 2002).

15

alleged that the proposed acquisition of FAG by INA would have lessened competition and

created a monopoly in the worldwide market for the research, development, manufacture and

sale of cartridge ball screw support bearings (“CBSSB”), a type of bearing used in

manufacturing machine tool equipment. According to the complaint, INA and FAG were the

only two suppliers of CBSSB in the world and the proposed acquisition, if consummated,

would have resulted in a monopoly in the market. Entry into the market was a difficult

process because of, among other things, the time and cost associated with researching and

developing a line of CBSSB products, acquiring the necessary production assets, and

developing the expertise needed to successfully design, produce, and market these products.

The order required INA and FAG to divest FAG’s CBSSB business to Aktiebolaget SKF, the

largest supplier of ball and other roller bearings in the world.

In Solvay S.A.,39 the complaint alleged that Solvay’s proposed $1.3 billion acquisition

of Ausimont S.p.A. from Italengeria S.p.A. would have lessened competition in the

production and sale of all grades of polyvinylidene fluoride (“PVDF”) and the production and

sale of melt-processible grades of PVDF. PVDF is a fluoropolymer used in a wide variety of

applications, including highly durable architectural coatings, wire and cable jacketing, fiber

optic raceways, chemical processing equipment, semiconductor manufacturing equipment,

and other miscellaneous applications. According to the complaint, Solvay and Ausimont were

two of only three producers of PVDF in the United States and were two of the three major

PVDF producers in the world. The proposed merger would have eliminated Ausimont as a

growing competitor in the market for melt-processible grades of PVDF, increasing the

likelihood of higher prices and reduced innovation in the relevant market. The order required

Solvay to divest its United States PVDF operations, including its Decatur, Alabama PVDF

plant and its interest in Alventia LLC, a joint venture that manufactures the main raw material

for PVDF.

In Bayer AG/Aventis S.A.,40 the complaint alleged the proposed $6.2 billion acquisition

by Bayer of Aventis’s subsidiary Aventis CropScience Holdings S.A. would have lessened

competition in the United States in the following markets: 1) new generation chemical

insecticide products; 2) new generation chemical insecticide active ingredients and related

technologies for various insecticide and animal health products; 3) post-emergent grass

herbicides for spring wheat; and 4) cool weather cotton defoliants. According to the

complaint, all of the relevant markets were highly concentrated. Bayer and Aventis were two

of only three firms competing significantly in the market for new generation chemical

insecticide active ingredients and products and the only firms that had developed and

successfully sold such products for non-repellent liquid termite control and for veterinarian

use in controlling fleas. The companies were also the only two suppliers of cool weather

cotton defoliants. The merger would have eliminated a significant competitor, increased

barriers to entry, reduced innovation competition for certain products, and increased the

possibility of coordinated interaction among the remaining competitors in the relevant

39

Solvay S.A., Docket No. C-4046 (issued June 21, 2002).

40

Bayer AG/Aventis S.A., Docket No. C-4049 (issued July 24, 2002).

16

markets. The order required the parties to divest assets relating to their acetamiprid, fipronil,

flucarbazone, and folex businesses.

In Amgen Inc./Immunex Corporation,41 the complaint alleged that the proposed $16

billion acquisition by Amgen of Immunex would have lessened competition in the United

States in the research, development and sale of the following: 1) neutrophil (white blood cell)

regeneration factors; 2) tumor necrosis factor (“TNF”) inhibitors used in the treatment of

rheumatoid arthritis; and 3) interleukin-1 (“IL-1”) inhibitors, also used in the treatment of

rheumatoid arthritis. According to the complaint, all three markets in the United States were

highly concentrated. Amgen and Immunex were the only two companies competing in the

market for neutrophil regeneration products and Immunex was only one of two companies

with TNF inhibitors on the market. Amgen’s Kineret was the only IL-1 inhibitor approved for

sale in the United States for the treatment of rheumatoid arthritis. Immunex and Regeneron

Pharmaceuticals Inc. were the only two companies with IL-1 inhibitor products in clinical

trials in the United States, but due to the patent position of Amgen and Immunex, Regeneron

would have likely been unable to bring its IL-inhibitor to market. To remedy the

anticompetitive effects of the proposed merger, the order required the companies to sell all of

Immunex’s assets related to Leukine, a neutrophil regeneration factor, to Schering AG. The

order also required the companies to grant a license to certain intellectual property rights

related to TNF inhibitors to Serono S.A. and certain intellectual property rights related to IL-1

inhibitors to Regeneron.

In Phillips Petroleum Company/Conoco Inc.,42 the complaint alleged that the proposed

merger of Phillips and Conoco would have lessened competition in the following markets: 1)

the bulk supply of light petroleum products in Eastern Colorado and Northern Utah; 2) light

petroleum product terminaling services in the metropolitan statistical areas (“MSAs”) of

Spokane, Washington, and Wichita, Kansas; 3) the bulk supply of propane in Southern

Missouri, the St. Louis MSA, and Southern Illinois; 4) natural gas gathering in more than 50

sections of the Permian Basin in New Mexico and Texas; and 5) the fractionation processes in

Mont Belvieu, Texas. According to the complaint, the merger would have eliminated ongoing

competition between the two companies resulting in the likelihood of increased rates and

terminaling services fees and the reduced output of propane, processed natural gas and other

products and services, thereby increasing consumer costs. The order required the companies

to divest several refineries, a light petroleum products terminal, a propane terminal, and

certain gas gathering assets. The parties were also required to create firewalls that prevent the

transfer of competitively sensitive information among the Mont Belvieu fractionators.

In Shell Oil Company/Pennzoil-Quaker State Company,43 the complaint alleged that

the proposed $1.8 billion acquisition of Pennzoil by Shell would have lessened competition

41

Amgen Inc./Immunex Corporation, Docket No. C-4056 (issued September 3, 2002).

42

Phillips Petroleum Company/Conoco Inc., Docket No. C-4058 (issued February 7, 2003).

43

Shell Oil Company/Pennzoil-Quaker State Company, Docket No. C-4059 (issued November 18,

2002).

17

and raised prices in the United States and Canadian market for Group II paraffinic base oil.

Group II base oil is used to produce motor oil and other lubricants, and is needed to meet

current performance standards for lighter-viscosity motor oil formulations, such as 5-W20 and

5-W30, as well as requirements for other lubricants. According to the complaint, Pennzoil

had a 50/50 joint venture with Conoco Inc. called Excel Paralubes that operated a base oil

refinery at West Lake, Louisiana adjacent to Conoco’s petroleum products refinery in Lake

Charles, Louisiana. The proposed merger would have eliminated Pennzoil as a major

competitor and positioned Shell, the market leader, into a close partnership with Conoco Inc.,

another leading producer. The price of Group II base oils would have likely increased by a

substantial amount, especially as new motor oil standards are developed and require even

greater use of Group II base oil. The order required the parties to divest Pennzoil’s 50 percent

interest in Excel Paralubes, which represents Pennzoil’s only base oil ownership position, to a

Commission-approved buyer and freeze Pennzoil’s ability to obtain additional Group II base

oil supply under an existing 10-year agreement with ExxonMobil Corporation at

approximately current levels.

ONGOING REASSESSMENT OF THE EFFECTS OF THE PREMERGER

NOTIFICATION PROGRAM

The Commission continually reviews the impact of the premerger notification program

on the business community and antitrust enforcement. As indicated in past annual reports, the

HSR program ensures that virtually all significant mergers or acquisitions that affect

American consumers in the United States will be reviewed by the antitrust agencies prior to

consummation. The agencies generally have the opportunity to challenge unlawful

transactions before they occur, thus avoiding the problem of constructing effective postacquisition relief. As a result, the HSR Act is doing what Congress intended, giving the

government the opportunity to investigate and challenge mergers that are likely to harm

consumers before injury can arise. Prior to the premerger notification program, businesses

could, and frequently did, consummate transactions that raised significant antitrust concerns

before the antitrust agencies had the opportunity to adequately consider their competitive

effects. The enforcement agencies were forced to pursue lengthy post-acquisition litigation,

during the course of which harm from the consummated transaction continued (and afterwards

as well, where achievement of effective post-acquisition relief was not practicable). Because

the premerger notification program requires reporting before consummation, this problem has

been significantly reduced.

Always cognizant of the program’s impact and effectiveness, the enforcement

agencies continue to seek ways to speed up the review process and reduce burdens for

companies. As in past years, the agencies will continue their ongoing assessment of the HSR

program in order to increase accessibility, promote transparency and reduce burden on the

filing parties without compromising the agencies’ ability to investigate and interdict proposed

transactions that may substantially lessen competition.

18

LIST OF APPENDICES

Appendix A -

Summary of Transactions, Fiscal Years 1993 - 2002

Appendix B -

Number of Transactions Reported and Filings Received by Month

for Fiscal Years 1993 - 2002.

LIST OF EXHIBITS

Exhibit A -

Statistical Tables for Fiscal Year 2002, Presenting Data Profiling

Hart-Scott-Rodino Premerger Notification Filings and

Enforcement Interest

APPENDIX A

SUMMARY OF TRANSACTIONS

FISCAL YEARS 1993 - 2002

APPENDIX A

SUMMARY OF TRANSACTION BY YEAR

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

Transactions Reported

1,846

2,305

2,816

3,087

3,702

4,728

4,642

4,926

2,376

1,187

1

3,559

4,403

5,439

6,001

7,199

9,264

9,151

9,941

4,800

2,369

Adjusted Transactions In Which A Second

Request Could Have Been Issued2

1,745

2,128

2,612

2,864

3,438

4,575

4,340

4,749

2,237

1,142

Investigations in Which Second Requests

Were Issued

71

73

101

99

122

125

111

98

70

49

FTC3

40

46

58

36

45

46

45

43

27

27

2.3%

2.2%

2.2%

1.3%

1.3%

1.0%

1.0%

0.9%

1.2%

2.4%

31

27

43

63

77

79

68

55

43

22

1.8%

1.3%

1.6%

2.2%

2.2%

1.7%

1.6%

1.2%

1.9%

1.9%

1,689

2,081

2,471

2,861

3,363

4,323

4,110

4,324

2,063

1,042

1,201

1,508

1,869

2,044

2,513

3,234

3,103

3,515

1,603

793

448

573

602

817

850

1,089

1,007

809

460

249

Filings Received

4

Percent

DOJ

3

4

Percent

Transactions Involving a Request For Early

Termination5

Granted5

Not Granted

1

5

Usually, two filings are received, one from the acquiring person and one from the acquired person when a transaction is reported. Only one application is received when an acquiring

party files for an exemption under sections 7A(c)(6) or (c)(8) of the Clayton Act.

2

These figures omit from the total number of transactions reported all transactions for which the agencies were not authorized to request additional information. These include (1)

incomplete transactions (only one party filed a complete notification); (2) transactions reported pursuant to the exemption provisions of sections 7A (c)(6) and 7A(c)(8) of the Act.; and

(3) transactions which were found to be non-reportable. In addition, where a party filed more than one notification in the same year to acquire voting securities of the same corporation,

e.g., filing one threshold and later filing for a higher threshold, only a single consolidated transaction has been counted because as a practical matter the agencies do not issue more than

one Second Request in such a case. These statistics also omit from the total number of transactions reported secondary acquisitions filed pursuant to 801.4 of the Premerger

Notification rules. Secondary acquisitions have been deducted in order to be consistent with the statistics presented in most of the prior annual reports.

3

These statistics are based on the date the request was issued and not the date the investigation was opened.

4

Second Requests investigations as a percentage of the total number of adjusted transactions.

5

These statistics are based on the date of the HSR filing and not the date action was taken on the request.

APPENDIX B

NUMBER OF TRANSACTIONS REPORTED

AND

FILINGS RECEIVED BY MONTH

FOR

FISCAL YEARS 1993 - 2002

APPENDIX B

TABLE 1. NUMBER OF TRANSACTIONS REPORTED BY MONTHS FOR THE FISCAL YEARS 1993 - 2002

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

163

184

273

238

296

424

333

376

360

89

OCTOBER

184

221

309

273

332

387

359

428

451

105

NOVEMBER

160

222

216

249

267

426

394

468

345

95

DECEMBER

100

156

180

238

263

306

282

335

245

111

JANUARY

110

149

170

231

250

336

330

440

66

87

FEBRUARY

149

167

229

277

315

392

427

455

120

109

MARCH

131

167

177

252

302

384

364

343

94

99

APRIL

155

220

281

304

328

401

438

398

153

111

MAY

151

182

252

253

319

442

445

494

190

88

JUNE

172

208

225

265

389

435

444

351

94

121

JULY

204

226

237

264

318

427

434

446

163

97

AUGUST

167

203

267

243

323

368

392

392

95

75

SEPTEMBER

1,846

2,305

2,816

3,087

3,702

4,728

4,642

4,926

2,376

1,187

TOTAL

APPENDIX B

OCTOBER

NOVEMBER

DECEMBER

JANUARY

FEBRUARY

MARCH

APRIL

MAY

JUNE

JULY

AUGUST

SEPTEMBER

TOTAL

1

TABLE 2. NUMBER OF FILINGS RECEIVED1 BY MONTH FOR FISCAL YEARS 1993 - 2002

1993

1994

1995

1996

1997

1998

1999

2000

297

332

505

450

561

818

662

777

341

428

614

520

636

749

686

839

325

427

419

474

521

836

785

922

188

293

360

445

514

614

548

677

239

295

326

480

483

650

658

867

263

326

432

528

614

766

828

959

251

321

350

498

599

763

719

695

301

421

534

584

640

787

851

859

311

362

496

502

620

862

884

1,004

327

380

439

515

759

851

887

718

393

431

455

515

617

844

885

886

323

387

509

490

635

724

758

738

3,559

4,403

5,439

6,001

7,199

9,264

9,151

9,941

2001

751

920

686

499

144

243

188

296

378

182

332

181

4,800

2002

190

211

183

224

174

230

203

212

170

230

191

151

2,369

Usually, two filings are received, one from the acquiring person and one from the acquired person when the transaction is reported, unless notification is for a

joint venture where more than one acquiring person is required to submit a filing. Only one filing is received when an acquiring person files for a transaction that

is exempt under Sections 7A(c)(6) and (c)(8) of the Clayton Act.

EXHIBIT A

STATISTICAL TABLES

FOR

FISCAL YEAR 2002

DATA PROFILING HART-SCOTT-RODINO PREMERGER

NOTIFICATION FILINGS AND ENFORCEMENT INTEREST

TABLE I

FISCAL YEAR 20021

ACQUISITIONS BY SIZE OF TRANSACTION (BY SIZE RANGE)2

TRANSACTION

RANGE

($MILLIONS)

HSR TRANSACTIONS

CLEARANCE GRANTED TO FTC OR DOJ

NUMBER4

NUMBER

PERCENT OF TRANSACTION

RANGE GROUP

DOJ

0

16

13

10

9

15

11

11

FTC

0.0%

7.7%

8.9%

12.5%

13.1%

14.4%

13.7%

16.5%

DOJ

0.0%

3.9%

7.3%

8.9%

6.9%

12.0%

11.6%

12.9%

TOTAL

0.0%

11.6%

16.2%

21.4%

20.0%

26.4%

25.3%

29.4%

85

10.9%

7.4%

18.3%

PERCENT

Less than 50

50 UP to 100

100 UP to 150

150 UP to 200

200 UP to 300

300 UP to 500

500 UP to 1000

1000 AND UP

5

2

414

179

112

130

125

95

85

0.2%

36.3%

15.7%

9.8%

11.4%

10.9%

8.3%

7.4%

FTC

0

32

16

14

17

18

13

14

ALL TRANSACTIONS

1,142

100.0%

124

SECOND REQUEST INVESTIGATIONS3

PERCENT OF

NUMBER

TRANSACTION RANGE

GROUP

FTC

DOJ

FTC

DOJ

TOTAL

0.0%

0.0%

0.0%

0

0

3

4

0.7%

1.0%

1.7%

3

3

1.6%

1.7%

3.3%

3

1

2.7%

0.9%

3.6%

3

1

2.3%

0.8%

3.1%

2

3

1.6%

2.4%

4.0%

6

5

6.3%

5.3%

11.6%

7

5

8.2%

5.9%

14.1%

27

22

2.4%

1.9%

4.3%

TABLE II

FISCAL YEAR 20021

ACQUISITIONS BY SIZE OF TRANSACTION2 (CUMULATIVE)

HSR TRANSACTIONS

TRANSACTION

RANGE ($MILLIONS)

NUMBER4

5

LESS THAN 50

LESS THAN 100

LESS THAN 150

LESS THAN 200

LESS THAN 300

LESS THAN 500

LESS THAN 1000

2

416

595

707

837

962

1,057

ALL TRANSACTIONS

1,142

PERCENT

0.2%

36.5%

52.2%

62.0%

73.4%

84.3%

91.7%

CLEARANCE GRANTED TO FTC OR DOJ

NUMBER

PERCENT OF

CLEARANCES

GRANTED

SECOND REQUEST INVESTIGATIONS3

NUMBER

PERCENT OF TOTAL

SECOND REQUESTS

ISSUED

FTC

0

32

48

62

79

97

110

DOJ

0

16

29

39

48

63

74

FTC

0.0%

15.3%

23.0%

29.7%

37.8%

46.4%

52.6%

DOJ

0.0%

7.7%

13.9%

18.7%

23.0%

30.1%

35.4%

TOTAL

0.0%

23.0%

36.9%

48.4%

60.8%

76.5%

88.0%

FTC

DOJ

FTC

DOJ

TOTAL

0

3

6

9

12

14

20

0

4

7

8

9

12

17

0.0%

6.1%

12.2%

18.4%

24.5%

28.6%

40.8%

0.0%

8.2%

14.3%

16.3%

18.4%

24.5%

34.7%

0.0%

14.3%

26.5%

34.7%

42.9%

53.1%

75.5%

124

85

59.3%

40.7%

100.0%

27

22

55.1%

44.9%

100.0%

TABLE III

FISCAL YEAR 20021

TRANSACTIONS INVOLVING THE GRANTING OF CLEARANCE BY AGENCY

CLEARANCE

GRANTED TO

AGENCY

TRANSACTION

RANGE ($ MILLIONS)

CLEARANCE GRANTED AS A PERCENTAGE OF

TOTAL NUMBER

TOTAL NUMBER OF

TOTAL NUMBER OF

OF

CLEARANCES

TRANSACTIONS4

CLEARANCES GRANTED

PER AGENCY

FTC

DOJ

TOTAL

FTC

DOJ

TOTAL

FTC

DOJ

FTC

DOJ

TOTAL

50 to 100

100 to 150

150 to 200

200 to 300

300 to 500

500 to 1000

1000 AND UP

32

16

14

17

18

13

14

16

13

10

9

15

11

11

48

29

24

26

33

24

25

2.8%

1.4%

1.2%

1.5%

1.6%

1.1%

1.2%

1.4%

1.1%

0.8%

0.8%

1.3%

1.0%

1.0%

4.2%

2.5%

2.1%

2.2%

2.8%

2.1%

2.4%

25.8%

12.9%

11.2%

13.7%

14.6%

10.6%

11.2%

18.8%

15.3%

11.8%

10.6%

17.7%

12.9%

12.9%

15.3%

7.7%

6.7%

8.1%

8.6%

6.2%

6.7%

7.6%

6.2%

4.8%

4.3%

7.2%

5.3%

5.3%

22.9%

13.9%

11.5%

12.4%

15.8%

11.5%

12.0%

ALL CLEARANCES

124

85

209

10.9%

7.4%

18.3%

100.0%

100.0%

59.3%

40.7%

100.0%

TABLE IV

FISCAL YEAR 20021

INVESTIGATIONS IN WHICH SECOND REQUESTS WERE ISSUED

INVESTIGATIONS IN

WHICH SECOND

REQUEST WERE ISSUED3

SECOND REQUESTS ISSUED AS A PERCENTAGE OF:

TRANSACTIONS IN

TOTAL NUMBER OF

TOTAL NUMBER OF

EACH TRANSACTION

SECOND REQUEST

TRANSACTIONS

RANGE GROUP

INVESTIGATIONS

50 to 100

100 to 150

150 to 200

200 to 300

300 to 500

500 to 1000

1000 AND UP

FTC

3

3

3

3

2

6

7

DOJ

4

3

1

1

3

5

5

TOTAL

7

6

4

4

5

11

12

FTC

0.3%

0.3%

0.3%

0.3%

0.2%

0.5%

0.6%

DOJ

0.4%

0.3%

0.1%

0.1%

0.3%

0.4%

0.4%

TOTAL

0.7%

0.6%

0.4%

0.4%

0.5%

0.9%

1.0%

FTC

0.7%

1.6%

2.7%

2.3%

1.6%

6.3%

8.2%

DOJ

1.0%

1.7%

0.9%

0.8%

2.4%

5.3%

5.9%

TOTAL

1.7%

3.3%

3.6%

3.1%

4.0%

11.6%

14.3%

FTC

6.1%

6.1%

6.1%

6.1%

4.1%

12.2%

14.3%

DOJ

8.2%

6.1%

2.1%

2.0%

6.1%

10.2%

10.2%

TOTAL

14.3%

12.2%

8.2%

8.1%

10.2%

22.4%

24.5%

ALL TRANSACTIONS

27

22

49

2.4%

1.9%

4.3%

2.4%

1.9%

4.3%

55.0%

44.9%

99.9%

TRANSACTION

RANGE ($MILLIONS)

TABLE V

FISCAL YEAR 20021

ACQUISITIONS BY REPORTING THRESHOLD

HSR TRANSACTIONS

THRESHOLD

NUMBER

PERCENT

PERCENTAGE OF

THRESHOLD GROUP

SECOND REQUEST

INVESTIGATIONS

PERCENTAGE OF

NUMBER

THRESHOLD GROUP

CLEARANCE GRANTED TO FTC OR DOJ

NUMBER

$50M

$100M

$500M

25%

50%

ASSETS ONLY

241

238

52

4

552

55

21.1%

20.8%

4.6%

0.4%

48.3%

4.8%

FTC

16

30

6

0

72

0

ALL TRANSACTIONS

1,142

100.0%

124

DOJ

8

12

9

1

46

9

FTC

DOJ

TOTAL

FTC

DOJ

FTC

DOJ

TOTAL

6.6%

12.6%

11.5%

0.0%

13.0%

0.0%

3.3%

5.0%

17.3%

25.0%

8.3%

16.4%

9.9%

17.6%

28.8%

25.0%

21.3%

16.4%

3

5

2

0

17

0

3

2

4

0

11

2

1.2%

2.1%

3.8%

0.0%

3.1%

0.0%

1.2%

0.8%

7.7%

0.0%

2.0%

3.6%

2.4%

2.9%

11.5%

0.0%

5.1%

3.6%

85

10.9%

7.4%

18.3%

27

22

2.4%

1.9%

4.3%

TABLE VI

FISCAL YEAR 2002

TRANSACTIONS BY ASSETS OF ACQUIRING PERSON

NUMBER

PERCENT

Below 50M

50M - 100M

100M - 150M

150M - 200M

200M - 300M

300M - 500M

500M - 1000M

OVER 1000M

47

25

24

38

44

103

129

732

4.1%

2.2%

2.1%

3.3%

3.9%

9.0%

11.3%

64.1%

CLEARANCE GRANTED TO FTC OR

DOJ

PERCENTAGE OF

NUMBER

ASSET RANGE GROUP

FTC

DOJ

FTC

DOJ TOTAL

0

1

0.0%

2.1%

2.1%

1

0

4.0%

0.0%

4.0%

2

1

8.3%

4.2%

12.5%

3

4

7.9%

10.5%

18.4%

5

0

11.4%

0.0%

11.4%

4

5

3.9%

4.9%

8.8%

14

12

10.9%

9.3%

20.2%

95

62

13.0%

8.5%

21.5%

ALL TRANSACTIONS

1,142

100.0%

124

ASSET RANGE

($MILLIONS)

HSR TRANSACTIONS

85

10.9%

7.4%

18.3%

SECOND REQUEST INVESTIGATIONS

NUMBER

PERCENTAGE OF

ASSET RANGE GROUP

FTC

DOJ

FTC

DOJ TOTAL

0

1

0.0%

2.1%

2.1%

1

0

4.0%

0.0%

4.0%

0

0

0.0%

0.0%

0.0%

0

1

0.0%

2.6%

2.6%

0

0

0.0%

0.0%

0.0%

3

2

2.9%

1.9%

4.9%

2

3

1.6%

2.3%

3.9%

21

15

2.9%

2.0%

4.9%

27

22

2.4%

1.9%

4.3%

TABLE VII

FISCAL YEAR 20021

TRANSACTIONS BY SALES OF ACQUIRING PERSON

SALES RANGE

($MILLIONS)

Below 50M

50M - 100M

100M - 150M

150M - 200M

200M - 300M

300M - 500M

500M - 1000M

0VER 1000M

Sales Not Available6

ALL TRANSACTIONS

HSR TRANSACTIONS

NUMBER

PERCENT

88

26

31

32

51

95

97

685

37

1,142

7.7%

2.3%

2.7%

2.8%

4.5%

8.3%

8.5%

60.0%

3.2%

100.0%

CLEARANCE GRANTED TO FTC OR

DOJ

NUMBER PERCENTAGE OF SALES

RANGE GROUP

FTC DOJ

FTC

DOJ

TOTAL

4

1

4.5%

1.1%

5.6%

2

1

7.7%

3.8%

11.5%

2

1

6.5%

3.2%

9.7%

1

2

3.1%

6.3%

9.4%

4

3

7.8%

5.9%

13.7%

4

9

4.2%

9.5%

13.7%

11

10

11.3%

10.3%

21.6%

95

58

13.9%

8.5%

22.3%

1

0

2.7%

0.0%

2.7%

124

85

10.9%

7.4%

18.3%

SECOND REQUEST

INVESTIGATIONS3

NUMBER

PERCENTAGE OF

SALES RANGE GROUP

FTC DOJ

FTC DOJ

TOTAL

0

1

0.0% 1.1%

1.1%

1

0

3.8% 0.0%

3.8%

1

0

3.2% 0.0%

3.2%

1

1

3.1% 3.1%

6.2%

0

0

0.0% 0.0%

0.0%

1

2

1.1% 2.1%

3.2%

2

2

2.1% 2.1%

4.2%

21

16

3.1% 2.3%

5.4%

0

0

0.0% 0.0%

0.0%

27

22

2.4% 1.9%

4.3%

TABLE VIII

FISCAL YEAR 2002

TRANSACTIONS BY ASSETS OF ACQUIRED ENTITIES

HSR TRANSACTIONS

ASSET RANGE

($MILLIONS)

NUMBER

PERCENT

CLEARANCE GRANTED TO FTC OR

DOJ

DOJ

24

17

8

5

2

10

8

8

3

PERCENTAGE OF ASSET

RANGE GROUP

FTC

DOJ

TOTAL

8.3%

6.9%

15.2%

9.9%

8.0%

17.9%

9.1%

7.3%

16.4%

13.1%

8.2%

21.3%

16.2%

2.7%

18.9%

15.2% 12.7%

27.9%

16.1% 14.3%

30.4%

7.9%

7.9%

15.8%

15.2%

3.0%

18.2%

85

10.9%

NUMBER

Below 50M

50M - 100M

100M - 150M

150M - 200M

200M - 300M

300M - 500M

500M - 1000M

0VER 1000M

Assets Not Available7

350

212

110

61

74

79

56

101

99

30.6%

18.6%

9.6%

5.3%

6.5%

6.9%

4.9%

8.8%

8.7%

FTC

29

21

10

8

12

12

9

8

15

ALL TRANSACTIONS

1,142

100.0%

124

7.4%

18.3%

SECOND REQUEST

INVESTIGATIONS

FTC

3

2

2

1

1

4

2

10

2

DOJ

4

5

0

1

1

1

6

3

1

PERCENTAGE OF

ASSET RANGE GROUP

FTC DOJ

TOTAL

0.9% 1.1%

2.0%

0.9% 2.4%

3.3%

1.8% 0.0%

1.8%

1.6% 1.6%

3.2%

1.4% 1.4%

2.7%

5.1% 1.3%

6.4%

3.6% 10.7%

14.3%

9.9% 3.0%

12.9%

2.0% 1.0%

3.0%

27

22

2.4%

NUMBER

1.9%

4.3%

TABLE IX

FISCAL YEAR 2002

TRANSACTIONS BY SALES OF ACQUIRED ENTITIES8

NUMBER

PERCENT

Below 50M

50M - 100M

100M - 150M

150M - 200M

200M - 300M

300M - 500M

500M - 1000M

0VER 1000M

Sales Not Available9

405

142

81

63

89

98

131

87

46

35.5%

12.4%

7.1%

5.5%

7.8%

8.6%

11.5%

7.6%

4.0%

CLEARANCE GRANTED TO FTC OR DOJ

PERCENTAGE OF SAKES

NUMBER

RANGE GROUP

FTC

DOJ

FTC

DOJ

TOTAL

37

28

9.1%

6.9%

16.0%

15

10

10.6%

7.0%

17.6%

5

7

6.2%

8.6%

14.8%

2

10

3.2%

15.9%

19.1%

12

7

13.5%

7.9%

21.4%

20

8

20.4%

8.2%

28.6%

13

7

9.9%

5.3%

15.2%

10

7

11.5%

8.0%

19.5%

10

1

21.7%

2.2%

23.9%

ALL TRANSACTIONS

1,142

100.0%

124

SALES RANGE

($ MILLIONS)

HSR TRANSACTIONS

85

10.9%

7.4%

18.3%

SECOND REQUEST

INVESTIGATIONS

PERCENTAGE OF

NUMBER

SAKES RANGE GROUP

FTC DOJ

FTC

DOJ

TOTAL

3

6

0.7%

1.5%

2.2%

3

1

2.1%

0.7%

2.8%

0

2

0.0%

2.5%

2.5%

0

0

0.0%

0.0%

0.0%

1

2

1.1%

2.2%

3.4%

5

1

5.1%

1.0%

6.1%

2

4

1.5%

3.1%

4.6%

13

5

14.9%

5.7%

20.7%

0

1

0.0%

2.2%

2.2%

27

22

2.4%

1.9%

4.3%

TABLE X

FISCAL YEAR 20021

INDUSTRY GROUP OF ACQUIRING PERSONS

3-DIGIT

NAICS

CODE 10

111

112

113

114

211

212

221

233

234

235

INDUSTRY

DESCRIPTION

AGRICULTURAL

PRODUCTION – CROPS

AGRICULTURAL

PRODUCTION –

LIVESTOCK AND ANIMAL

SPECIALTIES

LUMBER AND WOOD

PRODUCTS, EXCEPT

FURNITURE

FISHING, HUNTING AND

TRAPPING

OIL AND GAS

EXTRACTION

MINING AND QUARRYING

OF NONMETALLIC

MINERALS, EXCEPT

FUELS

ELECTRIC, GAS AND

SANITARY SERVICES

BUILDING CONSTRUCTION

– GENERAL

CONTRACTORS AND

OPERATIVE BUILDERS

HEAVY CONSTRUCTION

OTHER THAN BUILDING

CONSTRUCTION –

CONTRACTORS

CONSTRUCTION –

SPECIAL GRADE

CONTRACTORS

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

FTC

DOJ

TOTAL

FTC

DOJ

TOTAL

NC

0

0

0

0

0

0

0.1%

0.1%

0

0

0

0

0

0

1

0.1%

-0.1%

0

0

0

0

0

0

0

0.0%

NC

0

0

0

0

0

0

13

1.1%

0.1%

0

0

0

0

0

0

13

1.1%

1.1%

0

0

0

0

0

0

53

4.6%

4.1%

1

8

9

0

1

1

1

0.1%

-0.2%

0

0

0

0

0

0

4

0.4%

-0.2%

1

0

1

0

0

0

7

0.6%

0.1%

0

0

0

0

0

0

PERCENT

OF

TOTAL

CHANGE

FROM FY 200111

0

0.0%

1

NUMBER4

TABLE X

FISCAL YEAR 20021

INDUSTRY GROUP OF ACQUIRING PERSONS

3-DIGIT

NAICS

CODE 10

311

312

313

315

316

322

324

325

326

327

332

INDUSTRY

DESCRIPTION

FOOD AND KINDRED

PRODUCTS

BOTTLED AND CANNED

SOFT DRINKS AND

CARBONATED DRINKS;

AND CIGARETTE

MANUFACTURING

TEXTILE MILL PRODUCTS

APPAREL AND OTHER

FINISHED PRODUCTS

MADE FROM FABRICS

AND SIMILAR MATERIALS

LEATHER AND LEATHER

PRODUCTS

PAPER AND ALLIED

PRODUCTS

PETROLEUM REFINING

AND RELATED

INDUSTRIES

CHEMICALS AND ALLIED

PRODUCTS

RUBBER AND MISC.

PLASTICS PRODUCTS

STONE, CLAY, GLASS AND

CONCRETE PRODUCTS

FABRICATED METAL

PRODUCTS, EXCEPT

MACHINERY AND

TRANSPORTATION

EQUIPMENT

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

FTC

DOJ

TOTAL

FTC

DOJ

TOTAL

-0.1%

9

6

15

2

2

4

0.7%

0.6%

0

0

0

0

0

0

1

0.1%

-0.2%

0

0

0

0

0

0

1

0.1%

0.1%

0

0

0

0

0

0

0

0.0%

-0.2%

0

0

0

0

0

0

9

0.8%

0.1%

0

4

4

0

1

1

9

0.8%

0.5%

1

0

1

1

0

1

71

6.2%

1.3%

29

2

31

7

0

7

20

1.8%

0.8%

4

1

5

2

0

2

13

1.1%

0.7%

3

1

4

0

1

1

23

2.0%

0.6%

4

2

6

0

0

0

PERCENT

OF

TOTAL

CHANGE

FROM FY 200111

32

2.8%

8

NUMBER

4

TABLE X

FISCAL YEAR 20021

INDUSTRY GROUP OF ACQUIRING PERSONS

3-DIGIT

NAICS

CODE 10

333

334

335

336

337

339

421

422

441

INDUSTRY

DESCRIPTION

INDUSTRIAL AND

COMMERCIAL

MACHINERY AND

COMPUTER EQUIPMENT

MEASURING, ANALYZING

AND CONTROLLING

INSTRUMENTS;

PHOTOGRAPHIC,

MEDICAL AND OPTICAL

GOODS; WATCHES AND

CLOCKS

ELECTRONIC AND OTHER

ELECTRICAL EQUIPMENT

AND COMPONENTS,

EXCEPT COMPUTER

EQUIPMENT

TRANSPORTATION

EQUIPMENT

HOME FURNITURE,

FURNISHINGS AND

EQUIPMENT STORES

MISCELLANEOUS

MANUFACTURING

INDUSTRIES

WHOLESALE TRADE –

DURABLE GOODS

WHOLESALE TRADE –

NONDURABLE GOODS

AUTOMOTIVE DEALERS

AND GASOLINE SERVICE

STATIONS

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

FTC

DOJ

TOTAL

FTC

DOJ

TOTAL

-1.2%

2

6

8

0

2

2

6.9%

2.6%

11

12

23

3

4

7

10

0.9%

-4.4%

0

3

3

0

0

0

18

1.6%

-0.4%

4

1

5

1

0

1

4

0.4%

NC

2

0

2

0

0

0

15

1.3%

0.8%

3

0

3

0

0

0

43

3.8%

-0.2%

4

6

10

0

0

0

56

4.9%

1.6%

9

0

9

3

0

3

5

0.4%

-0.9%

0

0

0

0

0

0

PERCENT

OF

TOTAL

CHANGE

FROM FY 200111

22

1.9%

79

NUMBER

4

TABLE X

FISCAL YEAR 20021

INDUSTRY GROUP OF ACQUIRING PERSONS

3-DIGIT

NAICS

CODE 10

443

444

446

447

448

452

453

454

481

482

483

484

485

486

INDUSTRY

DESCRIPTION

MISCELLANEOUS REPAIR

SERVICES

BUILDING MATERIALS,

HARDWARE, GARDEN

SUPPLY, AND MOBILE

HOME DEALERS

MISCELLANEOUS RETAIL

FOOD STORES

APPAREL AND

ACCESSORY STORES

GENERAL MERCHANDISE

STORES

STATIONERY AND OFFICE

SUPPLIES

HEATING OIL DEALERS

AND LIQUEFIED

PETROLEUM GAS

TRANSPORTATION BY AIR

RAILROAD

TRANSPORTATION

WATER

TRANSPORTATION

MOTOR FREIGHT

TRANSPORTATION AND

WAREHOUSING

LOCAL AND SUBURBAN

TRANSIT AND

INTERURBAN HIGHWAY

PASSENGER

TRANSPORTATION

PIPELINES, EXCEPT

NATURAL GAS

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

FTC

DOJ

TOTAL

FTC

DOJ

TOTAL

0.1%

0

0

0

0

0

0

0.0%

-0.3%

0

0

0

0

0

0

6

2

0.5%

0.2%

-0.2%

-0.5%

2

0

0

1

2

1

0

0

0

0

0

0

4

0.4%

0.3%

0

0

0

0

0

0

1

0.1%

-0.2%

0

0

0

0

0

0

2

0.2%

-0.5%

0

0

0

0

0

0

8

0.7%

-0.3%

2

0

2

0

0

0

3

0.3%

-0.1%

0

0

0

0

0

0

1

0.1%

0.1%

0

0

0

0

0

0

3

0.3%

-0.3%

1

1

2

1

1

2

3

0.3%

-0.3%

0

0

0

0

0

0

0

0.0%

NC

0

0

0

0

0

0

21

1.8%

-1.2%

3

0

3

1

0

1

PERCENT

OF

TOTAL

CHANGE

FROM FY 200111

2

0.2%

0

NUMBER

4

TABLE X

FISCAL YEAR 20021

INDUSTRY GROUP OF ACQUIRING PERSONS

3-DIGIT

NAICS

CODE 10

511

512

513

521

522

523

524

525

532

541

551

561

611

621

INDUSTRY

DESCRIPTION

PRINTING, PUBLISHING

AND ALLIED INDUSTRIES

MOTION PICTURES

COMMUNICATIONS

DEPOSITORY

INSTITUTIONS

NONDEPOSITORY CREDIT

INSTITUTIONS

SECURITY AND

COMMODITY BROKERS,

DEALERS, EXCHANGES

AND SERVICES

INSURANCE CARRIERS

INSURANCE AGENTS,

BROKERS AND SERVICE

AUTOMOTIVE REPAIR,

SERVICES AND PARKING

SERVICES – BUSINESS,

LEGAL, ENGINEERING,

ACCOUNTING, RESEARCH,

MANAGEMENT AND

RELATED SERVICES

HOLDING AND OTHER

INVESTMENT OFFICES

TRANSPORTATION

SERVICES

EDUCATIONAL SERVICES

HEALTH SERVICES

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

FTC

DOJ

TOTAL

FTC

DOJ

TOTAL

1.5%

2

5

7

1

1

2

1.2%

6.9%

0.8%

0.2%

0

0

1

11

1

11

0

0

0

5

0

5

0

0.0%

1.5%

0

0

0

0

0

0

51

4.5%

3.4%

1

1

2

0

0

0

88

7.7%

4.4%

1

2

3

0

1

1

32

2.8%

0.8%

1

2

3

0

0

0

18

1.6%

0.9%

0

0

0

0

0

0

5

0.4%

NC

1

0

1

0

0

0

83

7.3%

6.5%

9

7

16

3

2

5

2

0.2%

-4.6%

0

0

0

0

0

0

20

1.8%

0.8%

3

0

3

0

0

0

3

0.3%

-9.7%

0

0

0

1

0

1

11

1.0%

0.4%

3

0

3

1

0

1

PERCENT

OF

TOTAL

CHANGE

FROM FY 200111

44

3.9%

14

79

NUMBER4

TABLE X

FISCAL YEAR 20021

INDUSTRY GROUP OF ACQUIRING PERSONS

3-DIGIT

NAICS

CODE 10

622

624

711

713

721

722

812

813

923

924

999

000

INDUSTRY

DESCRIPTION

GENERAL MEDICAL AND

SURGICAL; PSYCHIATRIC

AND SUBSTANCE ABUSE

HOSPITALS

SOCIAL SERVICES

REAL ESTATE

AMUSEMENT AND

RECREATION SERVICES

HOTELS, ROOMING

HOUSES, CAMPS, AND

OTHER LODGING PLACES

EATING AND DRINKING

PLACES

PERSONAL SERVICES

MEMBERSHIP

ORGANIZATIONS

ADMINISTRATION OF

HUMAN RESOURCE

PROGRAMS

ADMINISTRATION OF

ENVIRONMENTAL

QUALITY AND HOUSING

PROGRAMS

NON-CLASSIFICABLE

ESTABLISHMENTS

NOT AVAILABLE12

ALL TRANSACTIONS

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

FTC

DOJ

TOTAL

FTC

DOJ

TOTAL

0.8%

3

0

3

0

0

0

0.1%

0.4%

0.1%

-0.1%

0

0

0

0

0

0

0

0

0

0

0

0

5

0.4%

-3.1%

1

0

1

0

0

0

5

0.4%

0.1%

1

0

1

0

0

0

14

1.2%

0.5%

1

0

1

0

0

0

2

0.2%

0.1%

0

1

1

0

0

0

1

0.1%

NC

0

0

0

0

0

0

0

0.0%

-0.1%

0

0

0

0

0

0

0

0.0%

NC

0

0

0

0

0

0

0

0.0%

NC

0

0

0

0

0

0

56

4.9%

NC

2

1

3

0

1

1

124

85

209

27

22

49

PERCENT

OF

TOTAL

CHANGE

FROM FY 200111

16

1.4%

1

4

NUMBER4

1,142

Table XI

FISCAL YEAR 20021 INDUSTRY GROUP OF ACQUIRED ENTITIES

3-DIGIT

NAICS

CODE11

INDUSTRY DESCRIPTION

PERCENT

OF

NUMBER4

TOTAL

CHANGE

FROM FY

200112

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

NUMBER OF 3 DIGIT

INTRA-INDUSTRY

TRANSACTIONS13

(the data series for this column was revised

FTC

DOJ TOTAL FTC

DOJ TOTAL

in April, 2008)

111

Agricultural Production - Crops

0

0.0%

NC

0

0

0

0

0

0

0

112

Agricultural Production Livestock and Animal Specialties

1

0.1%

NC

0

0

0

0

0

0

1

3

0.3%

0.1%

0

0

0

0

0

0

1

0

11

0.0%

1.0%

NC

NC

0

0

0

0

0

0

0

0

0

0

0

0

0

9

9

0.8%

0.6%

0

0

0

0

0

0

3

58

5.1%

1.4%

1

8

9

0

1

1

44

0

0.0%

-0.2%

0

0

0

0

0

0

0

8

0.7%

0.1%

1

0

1

0

0

0

4

10

0.9%

0.5%

0

0

0

0

0

0

4

36

3.2%

0.6%

7

6

13

2

2

4

26

6

0.5%

0.3%

0

0

0

0

0

0

6

2

0.2%

-0.2%

0

0

0

0

0

0

1

1

0.1%

NC

0

0

0

0

0

0

1

0

0.0%

NC

0

0

0

0

0

0

0

113

114

211

212

221

233

234

235

311

312

313

315

316

Lumber and Wood Products,

Except Furniture

Fishing, Hunting and Trapping

Oil and Gas Extraction

Mining and Quarrying of

Nonmetallic Minerals, Except

Fuels

Electric, Gas and Sanitary

Services

Building Construction – General

Contractors and Operative

Builders

Heavy Construction Other Than

Building Construction Contractors

Construction - Special Grade

Contractors

Food and Kindred Products

Bottled and Canned Soft Drinks

and Corbonated Drinks; and

Cigarette Manufacturing

Textile Mill Products

Apparel and Other Finished

Products Made From Fabrics

and Similar Materials

Leather and Leather Products

Table XI

FISCAL YEAR 20021 INDUSTRY GROUP OF ACQUIRED ENTITIES

3-DIGIT

NAICS

CODE11

322

324

325

326

327

332

333

334

335

336

337

339

421

422

INDUSTRY DESCRIPTION

Paper and Allied Products

Petroleum Refining and Related

Industries

Chemicals and Allied Products

Rubber and Misc. Plastics

Products

Stone, Clay, Glass and Concrete

Products

Fabricated Metal Products,

Except Machinery and

Transportation Equipment

Industrial and Commercial

Machinery and Computer

Equipment

Measuring, Analyzing and

Controlling Instruments;

Photographic, Medical and

Optical Goods; Watches and

Clocks

Electronic and Other Electrical

Equipment and Components,

Except Computer Equipment

Transportation Equipment

Home Furniture, Furnishings

and Equipment Stores

Miscellaneous Manufacturing

Industries

Wholesale Trade - Durable

Goods

Wholesale Trade - Nondurable

Goods

PERCENT

OF

NUMBER4

TOTAL

CHANGE

FROM FY

200112

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

NUMBER OF 3 DIGIT

INTRA-INDUSTRY

TRANSACTIONS13

(the data series for this column was revised

DOJ TOTAL FTC

4

4

0

DOJ TOTAL

0

0

in April, 2008)

11

1.0%

0.1%

FTC

0

4

0.4%

NC

1

0

1

1

0

1

4

67

5.9%

1.6%

22

1

23

6

0

6

44

18

1.6%

0.3%

2

1

3

0

0

0

14

18

1.6%

1.2%

3

2

5

0

1

1

11

20

1.8%

-0.1%

4

2

6

0

0

0

16

24

2.1%

-0.9%

2

5

7

0

2

2

16

76

6.7%

2.4%

11

13

24

1

3

4

51

10

0.9%

-3.9%

0

4

4

0

0

0

7

23

2.0%

0.3%

5

1

6

1

0

1

13

3

0.3%

0.2%

2

0

2

0

0

0

2

13

1.1%

0.5%

3

0

3

0

0

0

7

55

4.8%

0.5%

7

4

11

2

0

2

32

49

4.3%

1.5%

10

0

10

3

0

3

30

6

Table XI

FISCAL YEAR 20021 INDUSTRY GROUP OF ACQUIRED ENTITIES

3-DIGIT

NAICS

CODE11

INDUSTRY DESCRIPTION

PERCENT

OF

NUMBER4

TOTAL

CHANGE

FROM FY

200112

CLEARANCE

GRANTED TO FTC

OR DOJ

(the data series for this column was revised

FTC

441

443

444

446

447

448

452

453

454

481

482

483

484

485

486

511

512

513

521

522

523

Automotive Dealers and

Gasoline Service Stations

Miscellaneous Repair Services

Building Materials, Hardware,

Garden Supply, and Mobile

Home Dealers

Miscellaneous Retail

Food Stores

Apparel and Accessory Stores

General Merchandise Stores

Stationery and Office Supplies

Heating Oil Dealers and

Liquefied Petroleum Gas

Transportation by Air

Railroad Transportation

Water Transportation

Motor Freight Transportation

and Warehousing

Local and Suburban Transit and

Interurban Highway Passenger

Transportation

Pipelines, Except Natural Gas

Printing, Publishing and Allied

Industries

Motion Pictures

Communications

Depository Institutions

Nondepository Credit

Institutions

Security and Commodity

Brokers, Dealers, Exchanges and

Services

SECOND REQUEST

INVESTIGATIONS3

NUMBER OF 3 DIGIT

INTRA-INDUSTRY

TRANSACTIONS13

DOJ TOTAL FTC

DOJ TOTAL

in April, 2008)

7

0.6%

-0.9%

0

0

0

0

0

0

4

2

0.2%

0.1%

0

0

0

0

0

0

2

0

0.0%

NC

0

0

0

0

0

0

0

9

1

9

2

0

0.8%

0.1%

0.8%

0.2%

0.0%

NC

-0.5%

0.6%

NC

NC

2

0

0

0

0

0

0

1

0

5

2

0

1

0

5

0

0

0

0

2

0

0

0

0

0

0

0

0

0

2

5

1

4

0

0

20

1.8%

NC

2

0

2

0

0

0

7

3

0

3

0.3%

0.0%

0.3%

NC

-0.1%

-0.4%

0

0

1

1

0

1

1

0

2

0

0

1

1

0

1

1

0

2

1

0

2

3

0.3%

-0.2%

0

0

0

1

0

1

1

0

0.0%

NC

1

0

1

1

0

1

0

23

2.0%

1.6%

4

0

4

0

0

0

13

55

4.8%

2.0%

2

7

9

0

2

2

32

18

100

1

1.6%

8.8%

0.1%

1.2%

1.2%

-1.2%

0

0

0

1

6

0

1

6

0

0

0

0

0

7

0

0

7

0

8

55

0

41

3.6%

1.9%

0

1

1

0

0

0

29

48

4.2%

0.9%

0

2

2

0

1

1

21

Table XI

FISCAL YEAR 20021 INDUSTRY GROUP OF ACQUIRED ENTITIES

3-DIGIT

NAICS

CODE11

524

525

532

541

551

561

611

621

622

624

711

713

721

722

812

813

711

923

924

INDUSTRY DESCRIPTION

Insurance Carriers

Insurance Agents, Brokers and

Service

Automotive Repair, Services and

Parking

Engineering, Accounting,

Research, Management and

Related Services

Holding and Other Investment

Offices

Transportation Services

Educational Services

Health Services

General Medical and Surgical;

Psychiatric and Substance Abuse

Hospitals

Social Services

Real Estate

Amusement and Recreation

Services

Hotels, Rooming Houses, Camps,

and Other Lodging Places

Eating and Drinking Places

Personal Services

Membership Organizations

Miscellaneous Services

Administration of Human

Resource Programs

Administration of

Environmental Quality and

Housing Programs

PERCENT

OF

NUMBER4

TOTAL

CHANGE

FROM FY

200112

CLEARANCE

GRANTED TO FTC

OR DOJ

SECOND REQUEST

INVESTIGATIONS3

NUMBER OF 3 DIGIT

INTRA-INDUSTRY

TRANSACTIONS13

(the data series for this column was revised

DOJ TOTAL FTC

2

3

0

DOJ TOTAL

0

0

in April, 2008)

32

2.8%

0.5%

FTC

1

3

0.3%

-0.7%

0

0

0

0

0

0

1

10

0.9%

0.5%

1

0

1

0

0

0

5

89

7.8%

-4.9%

10

5

15

3

1

4

57

0

0.0%

-1.2%

0

0

0

0

0

0

0

19

3

13

1.7%

0.3%

1.1%

0.7%

0.1%

-1.2%

3

0

3

0

0

0

3

0

3

0

0

1

0

0

0

0

0

1

9

3

6

14

1.2%

NC

3

0

3

0

0

0

13

0

4

0.0%

0.4%

-0.1%

0.4%

0

0

0

0

0

0

0

0

0

0

0

0

0

4

7

0.6%

NC

1

0

1

0

0

0

1

2

0.2%

NC

1

0

1

0

0

0

0

14

2

0

0

1.2%

0.2%

0.0%

0.0%

0.3%

0.1%

-2.5%

NC

1

0

0

0

0

1

0

0

1

1

0

0

0

0

0

0

0

0

0

0

0

0

0

0

2

0

0

0

0

0.0%

NC

0

0

0

0

0

0

0

0

0.0%

NC

0

0

0

0

0

0

0

22

Table XI

FISCAL YEAR 20021 INDUSTRY GROUP OF ACQUIRED ENTITIES

3-DIGIT

NAICS

CODE11

INDUSTRY DESCRIPTION

PERCENT

OF

NUMBER4

TOTAL

CHANGE

FROM FY

200112

CLEARANCE

GRANTED TO FTC

OR DOJ

(the data series for this column was revised

FTC

999

Nonclassificable Establishments

000

NOT AVAILABLE

ALL TRANSACTIONS

SECOND REQUEST

INVESTIGATIONS3

NUMBER OF 3 DIGIT

INTRA-INDUSTRY

TRANSACTIONS13

DOJ TOTAL FTC

DOJ TOTAL

in April, 2008)

0

0.0%

NC

0

0

0

0

0

0

0

49

1,142

4.3%

100.0%

1.1%

--

7

124

1

85

8

209

2

27

0

22

2

49

1

662

1

Fiscal Year 2002 figures include transactions reported between October 1, 2001 and September 30, 2002.

The size-of-transactions is based on the aggregate total amount of voting securities and/or assets to be held by the acquiring person as a result of the transaction and is taken from

the response to Item 3(b)(ii) and 3(c) of the notification form.

3

These statistics are based on the date that the second request was issued.

4

During fiscal year 2002, 1,187 transactions were reported under the HSR Premerger Notification program. The smaller number of 1,142 reflects adjustments to eliminate the

following types of transactions: (1) transactions reported under Sections 7A(c)(6) and (c)(8), (transactions involving certain regulated industries and financial businesses); (2)

transactions found to be non-reportable; (3) incomplete transactions (only one party in each transaction filed a compliant notification); and (4) transactions withdrawn before the

waiting period began. The table does not, however, exclude competing offers or multiple party transactions (transactions involving two or more acquiring persons).

5

The total number of filings under $50M submitted in Fiscal Year 2002 is corrective filings for transactions occurring before February 1, 2001.

6

This category includes newly formed acquiring persons, foreign acquiring persons with no United States revenues, and acquiring persons who had not derived any revenues from

their investments at the time of filing.

7

Assets of an acquired entity are not available when the acquired entity’s financial data is consolidated within its ultimate parent.

8

Sales of an acquired entity are taken from responses to Items 4(a) and (b) (SEC documents and annual reports) or Item 5 (dollar revenues) of the Premerger Notification and

Report form.

9

This category includes acquisitions of newly formed corporations or corporate joint ventures from which no sales were generated, and acquisitions of assets which produced no

sales or revenues during the prior year to filing the Notification and Report form.

10

The 3-digit codes are part of the North American Industrial Classification System (NAICS) established by the United States Government North American Industrial

Classification System 1997, Executive Office of the President – Office of Management and Budget. The NAICS groups used in this table were determined from responses

submitted by the parties to Item 5 of the Premerger Notification and Report effective July 1, 2001.

11

This number represents the deviation from the FY 2001 percentage.

12

This category includes transactions by newly formed entities.

13

The intra-industry transaction column identifies the number of acquisitions in which both the acquiring and acquired persons derived revenues in the same industry.

2