[Federal Register Volume 59, Number 222 (Friday, November 18, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-28499]
[[Page Unknown]]
[Federal Register: November 18, 1994]
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FEDERAL TRADE COMMISSION
[File No. 941 0054]
Oerlikon-Buhrle Holding AG; Proposed Consent Agreement With
Analysis to Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement.
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SUMMARY: In settlement of alleged violations of federal law prohibiting
unfair acts and practices and unfair methods of competition, this
consent agreement, accepted subject to final Commission approval, would
permit, among other things, a Switzerland-based corporation to acquire
Leybold AG, a German firm, but would require the respondent to divest
both the Leybold compact disc metallizer business and the Balzers-
Pfeiffer turbomolecular pump business, within 12 months after the
Commission order becomes final, to Commission approved entities. If the
divestitures are not completed within 12 months, the Commission would
be permitted to appoint trustees to complete them. In addition, the
respondent would be required, for ten years, to obtain Commission
approval before acquiring any interest in any entity engaged in either
of the two markets at issue.
DATES: Comments must be received on or before [Insert date 60 days
after Federal Register publication date].
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
Room 159, 6th Street and Pennsylvania Avenue NW., Washington, D.C.
20580.
FOR FURTHER INFORMATION CONTACT: Ann Malester or Michael Moiseyev, FTC/
S-2224, Washington, D.C. 20580. (202) 326-2682.
SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Section 2.34 of
the Commission's Rules of Practice (16 CFR 2.34), notice is hereby
given that the following consent agreement containing a consent order
to cease and desist, having been filed with and accepted, subject to
final approval, by the Commission, has been placed on the public record
for a period of sixty (60) days. Public comment is invited. Such
comments or views will be considered by the Commission and will be
available for inspection and copying at its principal office in
accordance with Section 4.9(b)(6)(ii) of the Commission's Rules of
Practice (16 CFR 4.9(b)(6)(ii)).
Agreement Containing Consent Order
The Federal Trade Commission (``Commission''), having initiated an
investigation of the proposed acquisition by Oerlikon-Buhrle Holding AG
(``Oerlikon-Buhrle''), a Swiss corporation, of Leybold AG,
(``Leybold''), a wholly-owned subsidiary of Degussa Aktiengesellschaft
(``Degussa''), a German corporation, and it now appearing that
Oerlikon-Buhrle, hereinafter sometimes referred to as ``Proposed
Respondent,'' is willing to enter into an agreement containing an order
to divest certain assets and cease and desist from making certain
acquisitions, and providing for certain other relief:
It is hereby agreed by and between Proposed Respondent Oerlikon-
Buhrle, by its duly authorized officers and attorneys, and counsel for
the Commission that:
1. Proposed Respondent Oerlikon-Buhrle is a corporation organized,
existing, and doing business under and by virtue of the laws of
Switzerland with its principal executive offices located at
Hofwiesenstrasse 135, CH-8021 Zurich, Switzerland.
2. Schweizerische Kreditantstalt (``SKA'') is a banking corporation
organized, existing, and doing business under and by virtue of the laws
of Switzerland with its principal executive offices located at
Paradeplatz, CH-8001 Zurich, Switzerland. Pursuant to the Trust
Agreement dated October 6, 1994, SKA will hold all of the outstanding
shares of Balzers-Pfeiffer GmbH in trust and for the account and risk
of Oerlikon-Buhrle as of the time Leybold is required by Oerlikon-
Buhrle, and will be an agent of Oerlikon-Buhrle.
3. Proposed Respondent admits all the jurisdictional facts set
forth in the draft of complaint here attached.
4. Proposed Respondent waives:
(a) any further procedural steps;
(b) the requirement that the Commission's decision contain a
statement of findings of fact and conclusions of law;
(c) all rights to seek judicial review or otherwise to challenge or
contest the validity of the order entered pursuant to this agreement;
and
(d) any claims under the Equal Access to Justice Act.
5. This agreement shall not become part of the public record of the
proceeding unless and until it is accepted by the Commission. If this
agreement is accepted by the Commission it, together with the draft of
complaint contemplated thereby, will be placed on the public record for
a period of sixty (60) days and information is respect thereto publicly
release. The Commission thereafter may either withdraw its acceptance
of this agreement and so notify the Proposed Respondent, in which event
it will take such action as it may consider appropriate, or issue and
serve its complaint (in such form as the circumstances may require) and
decision, in disposition of the proceeding
6. This agreement is for settlement purposes only and does not
constitute an admission by Proposed Respondent that the law has been
violated as alleged in the draft of complaint here attached, or that
the facts as alleged in the draft complaint, other than jurisdictional
facts, are true.
7. This agreement contemplates that, if it is accepted by the
Commission, and if such acceptance is not subsequently withdrawn by the
Commission pursuant to the provisions of Section 2.34 of the
Commission's Rules, the Commission may, without, further notice to
Proposed Respondent, (1) issue its complaint corresponding in form and
substance with the draft fo complaint here attached and its decision
containing the following order to divest and to cease and desist in
disposition of the proceeding, and (2) make information public with
respect thereto. When so entered, the order shall have the same force
and effect and may be altered, modified, or set aside in the same
manner and within the same time provided by statute for other orders.
The order shall become final upon service. Delivery by the U.S. Postal
Service of the complaint and decision containing the agreed-to order to
Proposed Respondent's wholly-owned subsidiary, Oerlikon-Buhrle USA,
Inc., at its principal executive offices at One Penn Plaza, Suite 4828,
New York, NY 10119, shall constitute service. Proposed Respondent
waives any right it may have to any other manner of service. The
complaint may be used in construing the terms of the order, and no
agreement, understanding, representation, or interpretation not
contained in the order or the agreement may be used to vary or
contradict the terms of the order.
8. Proposed Respondent has read the proposed complaint and order
contemplated hereby. Proposed Respondent understands that once the
order has been issued, it will be required to file one or more
compliance reports showing that it has fully complied with the order.
Proposed Respondent further understands it may be liable for civil
penalties in the amount provided by law for each violation of the order
by Respondent or any agent of Respondent, including without limitation
SKA, after it becomes final.
Order
I
It is ordered that, as used in this order, the following
definitions shall apply:
A. ``Oerlikon-Buhrle'' means Oerlikon-Buhrle Holding AG, its
predecessors, subsidiaries, divisions, and groups and affiliates
controlled by Oerlikon-Buhrle; their directors, officers, employees,
agents (including, but not limited to, SKA), and representatives; and
their successors and assigns.
B. ``Leybold'' means Leybold AG, its predecessors, subsidiaries,
divisions, and groups and affiliates controlled by Leybold; their
directors, officers, employees, agents, and representatives; and their
successors and assigns.
C. ``SKA'' means Schweizerische Kreditanstalt, a banking
corporation organized, existing and doing business under, and by virtue
of the laws of Switzerland. Pursuant to the Trust Agreement dated
October 6, 1994, SKA will hold all of the outstanding shares of
Balzers-Pfeiffer GmbH in trust and for the account and risk of
Oerlikon-Buhrle as of the time Leybold is acquired by Oerlikon-Buhrle,
and will be an agent of Oerlikon-Buhrle.
D. ``Balzers-Pfeiffer'' means Balzers-Pfeiffer GmbH, a German
corporation, its predecessors, subsidiaries, divisions, and groups and
affiliates controlled by Balzers-Pfeiffer; their directors, officers,
employees, agents, and representatives; and their successors and
assigns.
E. ``Respondent'' means Oerlikon-Buhrle.
F. ``Commission'' means the Federal Trade Commission.
G. ``Acquisition'' means Oerlikon-Buhrle's acquisition of voting
securities of Leybold pursuant to the Purchase Agreement dated January
21, 1994.
H. ``Assets and Businesses'' means all assets, properties,
businesses goodwill, tangible and intangible, including, without
limitation, the following:
1. all machinery, fixtures, equipment, vehicles, transportation
facilities, furniture, tools and other tangible personal property;
2. all customer lists, vendor lists, catalogs, sales promotion
literature, advertising materials, research materials, technical
information, management information systems, software, inventions,
copyrights, trademarks, trade names, trade secrets, intellectual
property, patents, technology, know-how, specifications, designs,
drawings, processes and quality control data;
3. inventory and storage capacity;
4. all rights, title and interest in and to the contracts entered
into in the ordinary course of business with customers (together with
associated bid and performance bonds), suppliers, sale representatives,
distributors, agents, personal property lessors, personal property
lessees, licensors, licensees, consignors and consignees;
5. all rights under warranties and guarantees, express or implied;
6. all books, records, and files; and
7. all items of prepaid expense.
I. ``Trust Agreement'' means the trust agreement dated October 6,
1994, between Oerlikon-Buhrle and SKA, attached hereto as Attachment 1,
pursuant to which SKA will hold all of the outstanding shares of
Balzers-Pfeiffer GmbH in trust and for the account and risk of
Oerlikon-Buhrle, as of the time Leybold is acquired by Oerlikon-Buhrle,
and will be an agent of Oerlikon-Buhrle.
J. ``Leybold Compact Disc Metallizer Business'' means all of
Leybold's rights, title and interest in and to:
1. compact disc metallizers, including, but not limited to,
Singulus, and all patents, trademarks, intellectual property,
production technology and know-how related to the manufacture,
distribution and sale of compact disc metallizers; and
2. all of Leybold's Assets and Businesses as further delineated in
Schedule A, attached hereto and made a part hereof.
K. ``Leybold Thin Film Coating Systems Business'' means all of
Leybold's rights, title and interest, as of the date this agreement is
accepted by the Commission, in all Assets and Businesses relating to
the development, manufacture, distribution, marketing or sale of vacuum
systems and equipment for the deposition of thin films, including
without limitation, vacuum web coating systems, architectural glass
coaters, compact disc metallizers, compact disc replication lines,
compact disc mastering equipment, precision optics coating systems,
ophthalmic lens coating systems, decorative hard coating systems,
silicon crystal growing systems, and vacuum coating systems for
research and development. Such Assets and Businesses shall include all
rights, title and interest in and to owned or leased real property,
together with appurtenances, licenses and permits. The Leybold Thin
Film Coating Systems Business excludes magnetic and magneto-optical
disc coating systems, systems for the manufacture of thin film heads
for magnetic drives, vacuum systems for the coating of plastic parts,
and vacuum systems for the coating of automotive parts.
L. ``Balzers-Pfeiffer Assets'' means all of the Assets and
Businesses of Balzers-Pfeiffer and all of the other Oerlikon-Buhrle
Assets and Businesses relating to the development, manufacture,
distribution, marketing, or sale of turbomolecular pumps, as delineated
in Schedule B, attached hereto and made a part hereof.
M. ``Ophthalmic Coating Business'' means all of Oerlikon-Buhrle's
rights, title and interest in all Assets and Businesses relating to the
development, manufacture, distribution, marketing, or sale of equipment
used in the application of coatings to ophthalmic lenses, including all
interests in such Assets and Businesses as acquired from Leybold.
N. ``Compact Disc Metallizers'' means vacuum systems for the
deposition of reflective coatings on audio compact discs and CD-ROMs.
O. ``Turbomolecular Pumps'' means vacuum pumps employing
turbomolecular processes to generate high vacuum environments.
II
It is further ordered that:
A. Oerlikon-Buhrle shall divest, absolutely and in good faith,
within twelve (12) months of the date this order becomes final, the
Leybold Compact Disc Metallizer Business, and shall also divest such
additional ancillary Assets and Businesses and effect such arrangements
as are necessary to assure the marketability, viability, and
competitiveness of the Leybold Compact Disc Metallizer Business;
provided that Oerlikon-Buhrle is not required to divest any of the
assets identified in Part 2 of Schedule A unless such assets are
required by the acquirer.
B. Oerlikon-Buhrle shall divest the Leybold Compact Disc Metallizer
Business only to an acquirer that receives the prior approval of the
Commission and only in a manner that receives the prior approval of the
Commission. The purpose of the divestiture is to ensure the
continuation of the Leybold Compact Disc Metallizer Business as an
ongoing, viable operation, engaged in the same business in which the
Leybold Compact Disc Metallizer Business is engaged at the time of the
proposed divestiture, and to remedy the lessening of competition
resulting from the Acquisition as alleged in the Commission's
complaint.
C. Upon reasonable notice from the acquirer to Oerlikon-Buhrle, for
a period of six months following the date of divestiture, Oerlikon-
Buhrle shall provide such personnel, information, technical assistance,
advice and training to the acquirer as is necessary to transfer the
Leybold Compact Disc Metallizer Business pursuant to Paragraph II.A.
and establish such business as a viable, ongoing concern. Such
assistance shall include reasonable consultation with knowledgeable
employees of Oerlikon-Buhrle to satisfy the acquirer's management that
its personnel are appropriately trained in the manufacture of compact
disc metallizers to the extent Oerlikon-Buhrle has the ability to do so
after the divestiture is complete. Oerlikon-Buhrle shall not charge the
acquirer a rate more than its own direct costs for providing such
technical assistance.
D. Pending divestiture of the Leybold Compact Disc Metallizer
Business, Oerlikon-Buhrle shall take such actions as are necessary to
maintain the viability, marketability, and competitiveness of the
Leybold Compact Disc Metallizer Business and to prevent the
destruction, removal, wasting, deterioration or impairment of the
Leybold Compact Disc Metallizer Business except for ordinary wear and
tear.
E. At the time of the execution of a purchase agreement between
Oerlikon-Buhrle and a proposed acquirer of the Leybold Compact Disc
Metallizer Business, Oerlikon-Buhrle shall provide the acquirer with a
complete list of all non-clerical, salaried employees of the Leybold
Compact Disc Metallizer Business, who have been involved in the
development, production, distribution, or sale of Leybold compact disc
metalizers at any time during the period from September 1, 1992, until
the date of the purchase agreement. Such list shall state each such
individual's name, position, address, telephone number, and a
description of the duties of and work performed by the individual in
connection with any compact disc metallizer product developed,
produced, or distributed by Leybold.
F. Oerlikon-Buhrle shall provide the proposed acquirer with an
opportunity to inspect the personnel files and other documentation
relating to the individuals identified in Paragraph II.E. of this order
to the extent permissible under applicable laws. For a period of six
(6) months following the divestiture, Oerlikon-Buhrle shall further
provide the Commission-approved acquirer with an opportunity to
interview such individuals and negotiate employment contracts with
them.
G. Oerlikon-Buhrle shall provide the individuals identified in
Paragraph II.E. of this order with ample financial incentives to
continue in their employment positions during the period covered by the
Leybold Hold Separate Agreement, hereto attached, and to accept
employment with the Commission-approved acquirer at the time of the
divestiture. Such incentives shall include:
1. continuation of all employee benefits offered by Leybold until
the date of the divestiture; and
2. a bonus equal to 25 percent of an employee's annual salary
(including any other bonuses) as of the date this order becomes final
for any individual who agrees to employment with the Commission-
approved acquirer, payable upon the beginning of their employment by
the Commission-approved acquirer.
H. For a period of one (1) year commencing on the date of the
individual's employment by the Commission-approved acquirer, Oerlikon-
Buhrle shall not re-hire any of the individuals identified in Paragraph
II.E. of this order who accept employment with the Commission-approved
acquirer.
III
It is further ordered that:
A. Respondent Oerlikon-Buhrle shall divest, and shall direct SKA to
take all steps necessary to divest, absolutely and in good faith,
within twelve (12) months of the date this order becomes final, the
Balzers-Pfeiffer Assets, and Oerlikon-Buhrle shall also divest such
additional ancillary Assets and Businesses and effect such arrangements
as are necessary to assure the marketability, viability, and
competitiveness of Balzers-Pfeiffer; provided that Oerlikon-Buhrle is
not required to divest any of the assets identified in Part 2 of
Schedule B, unless such assets are required by the acquirer.
B. Oerlikon-Buhrle shall divest, and shall direct SKA to take all
steps necessary to divest, the Balzers-Pfeiffer Assets only to an
acquirer that receives the prior approval of the Commission and only in
a manner that receives the prior approval of the Commission. The
purpose of the divestiture of the Balzers-Pfeiffer Assets is to ensure
the continuation of Balzers-Pfeiffer as an ongoing, viable operation,
engaged in the same business in which it is engaged at the time of the
proposed divestiture, and to remedy the lessening of competition
resulting from the Acquisition as alleged in the Commission's
complaint. Provided, however, that nothing in this order shall prevent
Oerlikon-Buhrle from transferring the stock and share capital of
Balzers-Pfeiffer to SKA at the time Oerlikon-Buhrle acquires Leybold
pursuant to the Trust Agreement. However, such transfer shall not
fulfill Oerlikon-Buhrle's obligation under this order to divest
Balzers-Pfeiffer Assets.
C. Pending divestiture of the Balzers-Pfeiffer Assets, Oerlikon-
Buhrle shall take such actions, and shall direct SKA to take such
actions, as are necessary to maintain the viability and marketability
of Balzers-Pfeiffer and to prevent the destruction, removal, wasting,
deterioration or impairment of any of the Balzers-Pfeiffer Assets
except for ordinary wear and tear.
D. Oerlikon-Buhrle shall take all steps necessary to ensure that
SKA complies with the Trust Agreement, including, without limitation,
pursuing any legal action it may have against SKA for monetary and
equitable damages arising from any breach of the Trust Agreement by
SKA. Oerlikon-Buhrle shall not agree to any alteration, reformation,
amendment or other change to the Trust Agreement without the prior
approval of the Commission. In addition to the requirements of this
Paragraph III, Oerlikon-Buhrle shall direct SKA to take all steps
necessary to accomplish the requirements of this order pertaining to
the Balzers-Pfeiffer Assets.
IV
It is further ordered that:
A. If Oerlikon-Buhrle has not divested, absolutely and in good
faith, and with the prior approval of the Commission, the Leybold
Compact Disc Metallizer Business within twelve (12) months of the date
this order becomes final, the Commission may appoint a trustee to
divest the Leybold Thin Film Coating Systems Business.
B. If Oerlikon-Buhrle and SKA have not divested, absolutely and in
good faith, and with the prior approval of the Commission, the Balzers-
Pfeiffer Assets within twelve (12) months of the date this order
becomes final, the Commission may appoint a trustee to divest the
Balzers-Pfeiffer Assets.
C. In the event that the Commission or the Attorney General brings
an action pursuant to Sec. 5(l) of the Federal Trade Commission Act, 15
U.S.C. Sec. 45(l), or any other statute enforced by the Commission,
Oerlikon-Buhrle and in the case of the Balzers-Pfeiffer Assets, SKA, at
the direction of Oerlikon-Buhrle, shall consent to the appointment of a
trustee in such action. Neither the appointment of a trustee nor a
decision not to appoint a trustee under this Paragraph IV shall
preclude the Commission or the Attorney General from seeking civil
penalties or any other relief available to it, including a court-
appointed trustee, pursuant to Sec. 5(l) of the Federal Trade
Commission Act, or any other statute enforced by the Commission, for
any failure by Oerlikon-Buhrle to comply with this order.
D. If a trustee is appointed by the Commission or a court pursuant
to Paragraph IV.A. or Paragraph IV.B., Oerlikon-Buhrle shall consent to
the following terms and conditions regarding the trustee's powers,
duties, authority, and responsibilities:
1. The Commission shall select the trustee, subject to the consent
of Oerlikon-Buhrle and in the case of the Balzers-Pfeiffer Assets, SKA,
at the direction of Oerlikon-Buhrle, which consent shall not be
unreasonably withheld. The trustee shall be a person with experience
and expertise in acquisitions and divestitures. If Oerlikon-Buhrle or
in the case of the Balzers-Pfeiffer Assets, SKA, at the direction of
Oerlikon-Buhrle, has not opposed, in writing, including the reasons for
opposing, the selection of any proposed trustee within ten (10) days
after notice by the staff of the Commission to Oerlikon-Buhrle of the
identity of any proposed trustee, Oerlikon-Buhrle shall be deemed to
have consented to the selection of the proposed trustee.
2. Subject to the prior approval of the Commission, the trustee
shall have the exclusive power and authority to divest the Leybold Thin
Film Coating Systems Business and/or the Balzers-Pfeiffer Assets.
3. Within ten (10) days after appointment of the trustee, Oerlikon-
Buhrle shall execute a trust agreement, and in the case of the Balzers-
Pfeiffer Assets, Oerlikon-Buhrle shall direct SKA to execute a trust
agreement, that, subject to the prior approval of the Commission and,
in the case of a court-appointed trustee, of the court, transfers to
the trustee all rights and powers necessary to permit the trustee to
effect the divestiture(s) required by this order.
4. The trustee shall have twelve (12) months from the date the
Commission approves the trust agreement described in Paragraph IV.D.3.
to accomplish the divestiture(s), which shall be subject to the prior
approval of the Commission. If, however, at the end of the twelve month
period, the trustee has submitted a plan of divestiture or believes
that divestiture can be achieved within a reasonable time, the
divestiture period may be extended by the Commission, or, in the case
of a court-appointed trustee, by the court; provided, however, the
Commission may extend this period only two (2) times.
5. The trustee shall have full and complete access to the
personnel, books, records and facilities related to the Leybold Thin
Film Coating Systems Business and/or the Balzers-Pfeiffer Assets, or to
any other relevant information, as the trustee may request. Oerlikon-
Buhrle shall develop, and in the case of the Balzers-Pfeiffer Assets,
Oerlikon-Buhrle shall direct SKA to develop such financial or other
information as such trustee may request and shall cooperate with the
trustee. Oerlikon-Buhrle shall take no action, and Oerlikon-Buhrle
shall direct SKA to take no action, to interfere with or impede the
trustee's accomplishment of the divestiture(s). Any delays in
divestiture caused by Oerlikon-Buhrle or SKA shall extend the time for
divestiture under this Paragraph in an amount equal to the delay, as
determined by the Commission or, for a court-appointed trustee, by the
court.
6. The trustee shall use his or her best efforts to negotiate the
most favorable price and terms available in each contract that is
submitted to the Commission, subject to Oerlikon-Buhrle's absolute and
unconditional obligation to divest at no minimum price. The
divestiture(s) shall be made in the manner and to the acquirer(s) as
set out in Paragraphs II and III of this order, as appropriate;
provided, however, if the trustee receives bona fide offers from more
than one acquiring entity, and if the Commission determines to approve
more than one such acquiring entity, the trustee shall divest to the
acquiring entity or entities selected by Oerlikon-Buhrle from among
those approved by the Commission. If requested by the trustee or
acquirer, Oerlikon-Buhrle shall provide the acquirer with the
assistance required by Paragraph II.C. of this order.
7. The trustee shall serve, without bond or other security, at the
cost and expense of Oerlikon-Buhrle, on such reasonable and customary
terms and conditions as the Commission or a court may set. The trustee
shall have the authority to employ, at the cost and expense of
Oerlikon-Buhrle, such consultants, accountants, attorneys, investment
bankers, business brokers, appraisers, and other representatives and
assistants as are necessary to carry out the trustee's duties and
responsibilities. The trustee shall account for all monies derived from
the divestiture(s) and all expenses incurred. After approval by the
Commission and, in the case of a court-appointed trustee, by the court,
of the account of the trustee, including fees for his or her services,
all remaining monies shall be paid at the direction of Oerlikon-Buhrle,
and the trustee's power shall be terminated. The trustee's compensation
shall be based at least in significant part on a commission arrangement
contingent on the trustee's divesting the Leybold Thin Film Coating
Systems Business and/or the Balzers-Pfeiffer Assets.
8. Oerlikon-Buhrle shall indemnify the trustee and hold the trustee
harmless against any losses, claims, damages, liabilities, or expenses
arising out of, or in connection with, the performance of the trustee's
duties, including all reasonable fees of counsel and other expenses
incurred in connection with the preparation for, or defense of any
claim, whether or not resulting in any liability, except to the extent
that such liabilities, losses, damages, claims, or expenses result from
misfeasance, gross negligence, willful or wanton acts, or bad faith by
the trustee.
9. If the trustee ceases to act or fails to act diligently, a
substitute trustee shall be appointed in the same manner as provided in
Paragraph IV of this order.
10. The Commission or, in the case of a court-appointed trustee,
the court, may on its own initiative or at the request of the trustee
issue such additional orders or directions as may be necessary or
appropriate to accomplish the divestitute(s) required by this order.
11. The trustee shall have no obligation or authority to operate or
maintain the Leybold Thin Film Coating Systems Business or the Blazers-
Pfeiffer Assets.
12. The trustee shall report in writing to Oerlikon-Buhrle and the
Commission every sixty (60) days concerning the trustee's efforts to
accomplish divestitute(s).
V
It is further ordered that, until the earlier of ten (10) years
from the date this order becomes final or until Oerlikon-Burle has sold
all of the Assets and Businesses of either Blazers' ophthalmic lens
coating business or Leybold's ophthalmic lens coating business,
Oerlikon-Buhrle shall not transfer any interest in the stock, share
capital, or assets of the Ophthalmic Coating Business to any third
party, other than to a subsidiary of Oerlikon-Buhrle, without providing
advance written notification to the Federal Trade Commission. Said
notification shall be given on the Notification and Report Form set
forth in the Appendix to Part 803 of Title 16 of the Code of Federal
Regulations as amended (hereinafter ``the Notification''). Oerlikon-
Buhrle shall provide to the Federal Trade Commission, at least thirty
days prior to transferring any interest in the stock, share capital, or
assets of the Ophthalmic Coating Business, both the Notification and
supplemental information either in Oerlikon-Buhrle's possession or
reasonably available to Oerlikon-Buhrle. Such supplemental information
shall include a copy of the proposed acquisition agreement; the names
of the principal representatives of Oerlikon-Buhrle and of the firm who
proposes to acquire the stock, share capital, or assets of the
Ophthalmic Coating Business who negotiated the acquisition agreement;
and any management or strategic plans discussing the proposed
transaction. If, within the thirty-day period, representatives of the
Federal Trade Commission make a written request for additional
information, Oerlikon-Buhrle shall not consummate the transaction until
twenty days after submitting such additional information. Early
termination of the waiting periods in this Paragraph may be requested
and, where appropriate, granted in the same manner as is applicable
under the requirements and provisions of the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, 15 U.S.C. Section 18a.
VI
It is further ordered that Oerlikon-Buhrle shall comply with all
terms of the Balazers-Pfeiffer Agreement to Hold Separate and the
Leybold Systems Business Agreement to Hold Separate, attached to this
order and made a part hereof as Appendices I and II. The Blazers-
Pfeiffer Agreement to Hold Separate the Blazers-Pfeiffer Assets shall
continue in effect until Oerlikon-Buhrle and SKA have divested all of
the Blazers-Pfeiffer Assets. The Leybold Systems Business Agreement to
Hold Separate shall continue in effect until Oerlikon-Buhrle has
divested all of the Leybold Compact Disc Metallizer Business or the
Leybold Thin Film Coating Systems Business as required by this order.
VII
It is further ordered that, for a period of ten (10) years from the
date this order becomes final, Oerlikon-Buhrle shall not, without the
prior approval of the Commission, directly or indirectly, through
subsidiaries, partnerships, or otherwise:
A. acquire any of the stock, share capital, equity or other
interest in any concern, corporate or non-corporate, engaged in at the
time of such acquisition, or within the two years preceding such
acquisition engaged in, the manufacture of turbomolecular pumps;
B. acquire any assets used for or previously used for (and still
suitable for use for) the manufacture, distribution, or sale of
turbomolecular pumps;
C. acquire any of the stock, share capital, equity or other
interest in any concern, corporate or non-corporate, engaged in at the
time of such acquisition, or within the two years preceding such
acquisition engaged in, the manufacture of compact disc metallizers; or
D. acquire any assets used for or previously used for (and still
suitable for use for) the manufacture, distribution, or sale of compact
disc metallizers.
Provided, however, that this Paragraph VII shall not apply to the
acquisition of products or services acquired in the ordinary course of
business, or of any non-exclusive license to any patent or other form
of intellectual property (excluding assets of the Leybold Compact Disc
Business and Blazers-Pfeiffer).
VIII
It is further ordered that:
A. Within sixty (60) days after the date this order becomes final
and every sixty (60) days thereafter until Oerlikon-Buhrle has fully
complied with Paragraphs II, III, IV, and VI of this order, Oerlikon-
Buhrle shall submit to the Commission a verified written report setting
forth in detail the manner and form in which it intends to comply, is
complying, and has complied with Paragraphs II, III, IV, and VI of this
order. Oerlikon-Buhrle shall include in its compliance reports, among
other things that are required from time to time, a full description of
the efforts being made to comply with Paragraphs II, III, IV, and VI of
this order, including a description of all substantive contacts or
negotiations for the divestiture(s) required by this order, including
the identity of all parties contacted. Oerlikon-Buhrle shall include in
its compliance reports copies of all written communications to and from
such parties, all internal memoranda, and all reports and
recommendations concerning the divestiture.
B. One (1) year from the date this order becomes final, annually
for the next nine (9) years on the anniversary of the date this order
becomes final, and at such other times as the Commission may require,
Oerlikon-Buhrle shall file a verified written report with the
Commission setting forth in detail the manner and form in which it has
complied and is complying with Paragraphs V and VII of this order.
IX
It is further ordered that, for the purpose of determining or
securing compliance with this order, Respondent shall permit any duly
authorized representatives of the Commission:
A. Access, during office hours and in the presence of counsel, to
inspect and copy all books, ledgers, accounts, correspondence,
memoranda and other records and documents in the possession or under
the control of Respondent, relating to any matters contained in this
order; and
B. Upon five (5) days' notice to Respondent, and without restraint
or interference from Respondent, to interview officers, directors, or
employees of Respondent. Officers and employees of Respondent whose
places of employment are outside the United States shall be made
available on reasonable notice.
X
It is further ordered that
A. Oerlikon-Buhrle shall notify the Commission at least thirty (30)
days prior to any proposed change in the corporate Respondent such as
dissolution, assignment, sale resulting in the emergence of a successor
corporation, or the creation or dissolution of subsidiaries or any
other change in the corporation that may affect compliance obligations
arising out of the order.
Schedule A
Oerlikon-Buhrle shall divest all of the Assets and Businesses of
the Leybold Compact Disc Metallizer Business pursuant to the terms of
this order. The assets identified in Paragraph I.J. of this order shall
include all assets, properties, business and goodwill, tangible and
intangible, of Leybold in or relating to the development, manufacture,
sale, distribution and marketing of compact disc metallizers, compact
disc lines, and compact disc mastering systems, including without
limitation, the following:
Part 1
1. all Leybold compact disc metallizers including, but not limited
to, equipment and documentation;
2. all Leybold compact disc metallizer inventory (including work in
progress);
3. all lists or other information necessary to source materials,
parts, components and other inputs involved in the production of
Leybold compact disc metallizers;
4. all rights, title and interest in and results of all research
and development efforts by Leybold relating to improvements,
developments, and variants of Leybold compact disc metallizer products;
Part 2
5. all Assets and Businesses of Leybold relating solely to the
development, manufacture, sale, distribution and/or marketing of
compact disc lines and/or compact disc mastering systems, including
equipment, documentation, inventory, work in process, information
necessary to source materials, parts, components, and other inputs, all
rights, title and interest and results of all research and development
efforts by Leybold relating solely to improvements, developments, and
variants or Leybold compact disc line and or mastering system products,
and employment contracts to the extent permissible under applicable
law.
Schedule B
Oerlikon-Buhrle shall divest all of the Assets and Businesses of
the Balzers-Pfeiffer Assets pursuant to the terms of this order. The
assets identified in Paragraph I.L. of this order shall include all
assets, properties, business and goodwill, tangible and intangible, of
Oerlikon-Buhrle as of the date this order is accepted by the
Commission, in or relating to the development, manufacture, marketing,
sale, and distribution of turbomolecular pumps, including without
limitation, the following:
Part 1
1. all of the stock and share capital, or participation held by
Oerlikon-Buhrle of Balzers-Pfeiffer, including, without limitation, all
stock, share capital, or participation held in trust by SKA for the
account and risk of Oerlikon-Buhrle as of the date Leybold is acquired
by Oerlikon-Buhrle;
2. all patents, intellectual property, trademarks, production
technology, and know-how related to the development, manufacture,
marketing, sale, or distribution of turbomolecular pumps;
3. all rights, title and interest in and results of all research
and development efforts relating to improvements, developments, and
variants of turbomolecular pump products;
4. all rights, title and interest in and to owned or leased real
property, together with appurtenances, licenses and permits used in the
manufacturer of turbomolecular pumps;
Part 2
5. all Assets and Businesses of Oerlikon-Buhrle (excluding Balzers-
Pfeiffer) in or relating to the sale, distribution or marketing of
turbomolecular pumps.
Analysis of Proposed Consent Order to Aid Public Comment
The Federal Trade Commission (``Commission'') has accepted subject
to final approval an agreement containing a proposed consent order from
Oerlikon-Buhrle Holding AG (``Oerlikon-Buhrle'') to resolve competitive
concerns with the proposed acquisition of Leybold AG, a wholly-owned
subsidiary of Degussa Aktiengesellschaft. Under the proposed order,
Oerlikon-Buhrle would: (1) divest its Turbomolecular Pump Business; (2)
divest the Leybold Compact Disc Metallizer Business; and (3) notify the
Commission before selling any assets of or interest in its Ophthalmic
Coating Business.
The proposed consent order has been placed on the public record for
sixty (60) days for reception of comments by interested persons.
Comments received during this period will become part of the public
record. After sixty (60) days, the Commission will review the agreement
and the comments received and will decide whether to withdraw its
acceptance of the agreement or to make final the agreement's proposed
order.
The draft complaint alleges that the proposed acquisition, if
consummated, would violate Section 7 of the Clayton Act, 15 U.S.C.
Sec. 18, as amended, and Section 5 of the FTC Act, 15 U.S.C. Sec. 45,
as amended, in the markets for turbomolecular pumps and compact disc
metallizers. The proposed consent order would remedy the alleged
violation by requiring divestitures to restore competition.
The proposed order would require Oerlikon-Buhrle to divest the
Leybold Compact Disc Metallizer Business and the Oerlikon-Buhrle
Turbomolecular Pump Business within twelve (12) months after the
proposed order becomes final. The proposed order would require
Oerlikon-Buhrle to take all steps necessary to ensure that
Schweizeierische Kreditanstalt (``SKA''), trustee for the
Turbomolecular Pump Business, cooperates to accomplish divestiture of
the Turbomolecular Pump Business. Under the terms of the order,
Oerlikon-Buhrle would be responsible for order violations caused by
SKA.
Oerlikon-Buhrle also would be required to divest, at the option of
the acquirer(s), Compact Disc Integrated Line assets, Compact Disc
Mastering assets, and the sales and service organization associated
with the Oerlikon-Buhrle Turbomolecular Pump Business.
To help ensure the viability of the Leybold Compact Disc Metallizer
Business, Oerlikon-Buhrle would be required to provide technical
assistance to the acquirer as necessary. In addition, Oerlikon-Buhrle
would be required to give the acquirer an opportunity to interview and
offer employment to personnel involved in the Leybold Compact Disc
Metallizer Business and to offer financial incentives for employees to
remain with Leybold pending divestiture and to accept employment with
the acquirer after divestiture. Oerlikon-Buhrle could not rehire any of
these employees until one year after they began employment with the
acquirer.
If Oerlikon-Buhrle failed to divest the Leybold Compact Disc
Metallizer Business during the allotted time, a trustee could be
appointed to divest the Leybold Thin Film Coating Systems Business. If
Oerlikon-Buhrle failed to divest the Turbomolecular Pump Business, a
trustee could be appointed to divest the Turbomolecular Pump Business.
If, at the end of twelve months, the trustees submitted a plan of
divestiture or believed that divestiture could be achieved within a
reasonable time, the time period for divestiture could be extended.
A Hold Separate Agreement provides that until the divestiture of
the Leybold Compact Disc Metallizer Business is completed, the Leybold
Thin Film Coating Systems Business shall be held separate from and
operated independently of Oerlikon-Buhrle. A second Hold Separate
Agreement provides that until the divestiture of the Oerlikon-Buhrle
Turbomolecular Pump Business is completed, this business shall be held
separate from and operated independently of Oerlikon-Buhrle.
Under the proposed order, Oerlikon-Buhrle would be required to
provide to the Commission reports of its compliance with the
divestiture provisions of the order sixty (60) days after the order
becomes final and every sixty (60) days thereafter, until the
divestitures have been completed.
The proposed order would require Oerlikon-Buhrle, for ten (10)
years, to obtain the prior approval of the Commission before acquiring
any interest in any other company engaged in the manufacture,
distribution or sale of turbomolecular pumps or compact disc
metallizers.
The proposed order also would require Oerlikon-Buhrle to provide
advance notice to the Commission before selling any interest in or
assets of its Ophthalmic Coating Business.
The purpose of this analysis is to facilitate public comment on the
proposed order, and it is not intended to constitute an official
interpretation of the agreement and proposed order or to modify in any
way their terms.
Donald S. Clark,
Secretary.
[FR Doc. 94-28499 Filed 11-17-94; 8:45 am]
BILLING CODE 6750-01-M