UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

______________________________

)

In the Matter of )

) File No. 961-0106

INSILCO CORPORATION, )

a corporation. )

______________________________)

AGREEMENT CONTAINING CONSENT ORDER

The Federal Trade Commission ("Commission"), having initiated

an investigation of the acquisition of the assets of HelimaHelvetion International, Inc. ("Helima"), and of all the capital

stock of ARUP Alu-Rohr und Profil GmbH ("ARUP") from Helmut

Lingemann GmbH & Co. by Insilco Corporation ("Insilco"), and it now

appearing that Insilco, hereinafter sometimes referred to as the

"proposed respondent," is willing to enter into an agreement

containing an order to divest certain assets, cease and desist from

certain acts and practices, and providing for certain other relief:

IT IS HEREBY AGREED by and between the proposed respondent, by

its duly authorized officers and attorney, and counsel for the

Commission that:

1. Proposed respondent Insilco is a corporation organized,

existing, and doing business under and by virtue of the laws of

the state of Delaware, with its office and principal place of

business located at 425 Metro Place N., Dublin, Ohio 43017.

2. The proposed respondent admits all the jurisdictional

facts set forth in the draft of complaint here attached.

3. The proposed respondent waives:

a. any further procedural steps;

b. the requirement that the Commission’s decision
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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 claim under the Equal Access to Justice Act.

4. 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 with respect thereto publicly released. 

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.

5. This agreement is for settlement purposes only and does

not constitute an admission by the 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.

6. 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

§ 2.34 of the Commission’s Rules, 16 C.F.R. § 2.34, the

Commission may, without further notice to the proposed

respondent, (1) issue its complaint, corresponding in form and

substance with the attached draft of complaint, 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 as provided by statute for other orders. The Order shall

become final upon service. Delivery by U.S. Postal Service of

the complaint and decision containing the agreed-to Order to

proposed respondent’s address as stated in this agreement shall

constitute service. Proposed respondent
3

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 this agreement may be used to vary or

contradict the terms of the Order.

7. Proposed respondent has read the draft 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 that it may

be liable for civil penalties in the amount provided by law for

each violation of the Order after it becomes final.

ORDER

I

IT IS ORDERED that, as used in this Order, the following

definitions shall apply:

A. "Respondent" means Insilco Corporation ("Insilco"), its

directors, officers, employees, agents, and representatives,

predecessors, successors, and assigns; its subsidiaries, divisions,

groups, and affiliates controlled by Insilco; and the respective

directors, officers, employees, agents, representatives, successors,

and assigns of each.

B. "Lingemann" means Helmut Lingemann GmbH & Co., its

directors, officers, employees, agents, and representatives,

predecessors, successors, and assigns; its subsidiaries, divisions,

groups, and affiliates controlled by Lingemann; and the respective

directors, officers, employees, agents, representatives, successors,

and assigns of each.

C. "Maschinenbau" means Helmut Lingemann Maschinenbau GmbH,

its directors, officers, employees, agents, and representatives,

predecessors, successors, and assigns; its subsidiaries, divisions,

groups, and affiliates controlled by Maschinenbau; and the

respective directors, officers, employees, agents, representatives,

successors, and assigns of each.
4

D. "Commission" means the Federal Trade Commission.

E. "Helima Acquisition" means the acquisition of the assets

of Helima-Helvetion International, Inc. and of all the capital stock

of ARUP Alu-Rohr und Profil GmbH from Lingemann by Insilco.

F. "Thin-Wall Welded-Seam Aluminum Tubes" means welded-seam

aluminum heat exchanger tubes with wall thickness less than 0.65

millimeters used in the manufacture of heat exchangers, which are

devices that transfer heat from one fluid or gas to another medium,

generally air. These heat exchangers generally are used in

automotive applications. Thin-Wall Welded-Seam Aluminum Tubes does

not include tubes used as spacers between thermal pane windows,

condenser headers, or manifolds.

G. "Welded Tube Mill" means a high frequency welding machine

capable of producing Thin-Wall Welded-Seam Aluminum Tubes.

H. "Lingemann Mill" means a Welded Tube Mill manufactured by

Lingemann and operated by Helima-Helvetion International, Inc., or

ARUP Alu-Rohr und Profil GmbH prior to the Helima Acquisition.

I. "Marketability, Viability, and Competitiveness" means that

the specified assets, when used in conjunction with the assets of

the acquirer, are capable of operating in substantially the same

manner, quality, and efficiency employed or achieved by the

respondent prior to divestiture.

J. "Non-Aggregated, Customer-Specific Information" means

information about a product’s cost and/or price that is in such a

form that the cost and/or price of a product for an identifiable

individual customer can be identified.

K. "Strategies or Policies Related to Competition" means

information relating to a company’s approach to negotiating with

specific customers, targeting specific customers, identifying or in

any other manner attempting to win specific customers, retaining

specific customers, or risk of loss of specific customers,

including, but not limited to, all sales personnel call reports,

market studies, forecasts, and surveys which contain such

information.

L. " Analyses or Formulas Used to Determine Costs or Prices"
5

means a method, study, test, program, examination, tool, or other type

of logical reasoning used to determine a product’s cost and/or price

for an identifiable individual customer.

M. "Person" means any natural person, corporate entity,

partnership, association, joint venture, or trust.

N. "Independent Agent" means a Person not regularly employed by

the company that does not have and will not have direct or indirect

responsibility for prices or pricing or the ability to influence

prices or pricing or an attorney regularly employed by the company

that does not have and will not have direct or indirect responsibility

for prices or pricing or the ability to influence prices or pricing.

O. "Assets To Be Divested" include the following:

(a) one (1) fully functioning and operational Lingemann

Mill, consisting of a high frequency welder, a rollforming base,

a cutoff saw, a finished product drop table, a stock reel

decoder, a vacuum coil lifter, and control cabinets, capable of

producing Thin-Wall Welded-Seam Aluminum Tubes with a diameter of

less than forty (40) millimeters;

(b) one (1) fully functioning and operational Lingemann

Mill, consisting of a high frequency welder, a rollforming base,

a cutoff saw, a finished product drop table, a stock reel

decoder, a vacuum coil lifter, and control cabinets, capable of

producing Thin-Wall Welded-Seam Aluminum Tubes with a diameter of

greater than seventy-five (75) millimeters; and

(c) one (1) set of tooling capable of operating on both

mills.

P. "Technology and Know-How" means all of Respondent’s

drawings, patents, specifications, tests, and other documentation, and

all information contained therein or available to Respondent’s

personnel relating to the design, and the production methods,

processes, and systems used in the production of Thin-Wall Welded-Seam

Aluminum Tubes utilizing Lingemann Mills or the operation and

maintenance of Lingemann Mills for use in the production of Thin-Wall

Welded-Seam Aluminum Tubes.
6

Technology and Know-How does not include the drawings, patents,

specifications, tests, and other documentation, and all information

not acquired by Respondent in the Helima Acquisition and not developed

by Respondent following the Helima Acquisition specifically relating

to the design, and the production methods, processes, and systems used

in the production of Thin-Wall Welded-Seam Aluminum Tubes utilizing

Lingemann Mills or the operation and maintenance of Lingemann Mills

for use in the production of Thin-Wall Welded-Seam Aluminum Tubes.

Q. "Sole Source Replacement Parts" means all parts needed to

operate and maintain the Assets To Be Divested that are not readily

available from a source other than Respondent.

 R. "Helima Assets" means all Welded Tube Mills, including

machinery, fixtures, equipment, and tooling used in the maintenance or

operation of such mills, acquired by Insilco in its acquisition of the

assets of Helima-Helvetion International, Inc., from Lingemann. 

II

IT IS FURTHER ORDERED that:

A. Respondent shall divest, absolutely and in good faith, no

later than four (4) months after the date on which this Order becomes

final, the Assets To Be Divested.

B. The divestiture shall be made 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 continued use of the Assets To Be

Divested in the same business in which the Assets To Be Divested are

presently engaged, and to remedy the lessening of competition

resulting from the Helima Acquisition as alleged in the Commission’s

complaint.

C. Respondent shall also divest to the acquirer such additional

ancillary assets that are not readily available from a source other

than Respondent, including, but not limited to, machinery, fixtures,

equipment, and software, used in the maintenance or operation of the

Assets To Be Divested as are
7

necessary to assure the Marketability, Viability, and Competitiveness

of the Assets To Be Divested.

D. Respondent shall grant to the acquirer a perpetual, nonexclusive royalty-free license of any and all Technology and Know-How

necessary to assure the Marketability, Viability, and Competitiveness

of the Assets To Be Divested. Such license shall be effective only in

connection with the operation of the Assets To Be Divested by the

acquirer, any successor to the acquirer, or any subsequent owner of

the Lingemann Mills included in the Assets To Be Divested. The

acquirer shall also have the right to sublicense the Technology and

Know-How encompassed within its license for use on other assets or

equipment physically located in North America.

E. A condition of approval by the Commission of the divestiture

shall be the submission by the acquirer to the Commission of an

acceptable five-year business plan for the Assets To Be Divested

demonstrating that the acquirer will establish the Assets To Be

Divested as a viable and competitive business in North America.

F. On reasonable notice to Respondent from the acquirer of the

Assets To Be Divested, Respondent shall provide assistance and

training to the acquirer to enable the acquirer to design,

manufacture, and produce Thin-Wall Welded-Seam Aluminum Tubes at a

comparable cost in substantially the same manner and quality employed

or achieved by the respondent with the Assets To Be Divested prior to

divestiture. Such assistance and training shall include, without

limitation, consultation with employees of Insilco knowledgeable about

Lingemann Mills and training at the North American manufacturing

facilities of Insilco utilizing Lingemann Mills. If training at the

North American manufacturing facilities of Insilco utilizing Lingemann

Mills is not possible, Respondent shall provide training at any

manufacturing facility of Insilco utilizing Lingemann Mills. 

Respondent shall charge no more than its own direct costs incurred in

providing such assistance and training, including reimbursement

(commensurate with the salary and benefits of Insilco personnel

involved) for the time plus expenses of Insilco personnel providing

assistance and training. Respondent shall continue to provide such

assistance and training until the acquirer of the Assets To Be

Divested is satisfied in its reasonable business judgement that
8

it is capable of producing Thin-Wall Welded-Seam Aluminum Tubes

utilizing the Assets To Be Divested at a comparable cost in

substantially the same manner and quality achieved by Respondent prior

to divestiture with the Assets To Be Divested; provided, however,

Respondent shall not be required to continue providing such technical

assistance and training for more than one (1) year after the date on

which the divestiture required by this Order is made if the acquirer

of the Assets To Be Divested is a manufacturer of Thin-Wall WeldedSeam Aluminum Tubes with sales of Thin-Wall Welded-Seam Aluminum Tubes

greater than one million dollars ($1,000,000) in the fiscal year prior

to the date of divestiture. If the acquirer of the Assets To Be

Divested is not a manufacturer of Thin-Wall Welded-Seam Aluminum Tubes

with sales of Thin-Wall Welded-Seam Aluminum Tubes greater than one

million dollars ($1,000,000) in the fiscal year prior to the date of

divestiture, Respondent shall be required to provide such technical

assistance and training for a period not longer than three (3) years

after the date on which the divestiture required by this Order is

made.

G. On reasonable notice to Respondent from the acquirer of the

Assets To Be Divested, Respondent shall provide Sole Source

Replacement Parts to the acquirer. Respondent shall charge no more

than its own direct costs incurred in providing such Sole Source

Replacement Parts. Respondent shall not be required to continue

providing such Sole Source Replacement Parts for more than two (2)

years after the date on which the divestiture required by this Order

is made.

H. The Assets To Be Divested shall be supplied as completely

wired and piped systems, requiring only the placement and bolting

together of the sub-bases, the reconnection of the electrical wires at

numbered terminal block junctions, and the connection of the piping to

the union joints.

I. Qualification, performance, and the acquirer’s acceptance of

the Assets To Be Divested shall be performed at the facility of the

acquirer in a manner to ensure that the Assets To Be Divested are

capable of producing Thin-Wall Welded-Seam Aluminum Tubes in

substantially the same manner and quality employed or achieved by the

respondent with the Assets To Be Divested prior to divestiture.
9

J. On reasonable notice to Respondent by a customer, Respondent

shall provide the approved acquirer tooling owned by, assigned to, or

licensed to the Respondent, which was produced prior to the date this

Order becomes final and not included in the Assets To Be Divested, and

which was manufactured specifically for and used solely for that

customer’s products. Respondent may charge the reasonable costs

incurred in the manufacture of the tooling.

K. Pending divestiture of the Assets To Be Divested, Respondent

shall take such actions as are reasonably necessary to maintain the

Marketability, Viability, and Competitiveness of the Assets To Be

Divested and to prevent the destruction, removal, wasting,

deterioration, or impairment of the Assets To Be Divested.

L. Pending divestiture of the Assets To Be Divested, Respondent

shall take such actions as are reasonably necessary to maintain the

Marketability, Viability, and Competitiveness of the Helima Assets to

prevent the destruction, removal, wasting, deterioration, or

impairment of the Helima Assets.

III

IT IS FURTHER ORDERED that:

A. If Respondent has not divested, absolutely and in good faith

and with the Commission’s prior approval, the Assets To Be Divested

within four (4) months of the date this Order becomes final, then the

Commission may appoint a trustee to divest the Helima Assets and

effect such additional arrangements as are necessary, in order to

assure the Marketability, Viability, and Competitiveness of the Helima

Assets. In the event the Commission or the Attorney General brings an

action pursuant to Section 5( l) of the Federal Trade Commission Act,

15 U.S.C. § 45( l), or any other statute enforced by the Commission,

Respondent 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 shall preclude the Commission

or the Attorney General from seeking civil penalties or any other

relief (including, but not limited to, a court-appointed trustee)

pursuant to the Federal Trade Commission
10

Act or any other statute, for any failure by the Respondent to comply

with this Order.

B. If a trustee is appointed by the Commission or a court

pursuant to Paragraph III(A) of this Order, Respondent 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 Respondent, which consent shall not be unreasonably

withheld. The trustee shall be a person with experience and

expertise in acquisitions and divestitures. If Respondent has

not opposed, in writing, including the reasons for opposition,

the selection of any proposed trustee within ten (10) days after

notice by the staff of the Commission to Respondent of the

identity of any proposed trustee, Respondent 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 Helima

Assets and effect such additional arrangements as are necessary,

in order to assure the Marketability, Viability, and

Competitiveness of the Helima Assets.

3. Within ten (10) days after appointment of the trustee,

Respondent shall 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 of the Helima Assets and effect such additional

arrangements as are necessary to assure the Marketability,

Viability, and Competitiveness of the Helima Assets, in order to

expeditiously accomplish the remedial purposes of this Order.

4. The trustee shall have twelve (12) months to accomplish the

divestiture required by this Order, which shall be subject to the

prior approval of the Commission. If, however, at the end of the

twelve (12) month period, the trustee has submitted a plan of

divestiture or believes that divestiture can be achieved within a

reasonable time, the
11

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 for no more than two (2) additional

times.

5. The trustee shall have full and complete access to the

personnel, books, records, and facilities related to the Helima

Assets or to any other relevant information necessary to permit

the trustee to effect the divestiture of the Helima Assets, as

the trustee may request. Respondent shall develop such financial

or other information as such trustee may request and shall

cooperate with the trustee. Respondent shall take no action to

interfere with or impede the trustee’s accomplishment of the

divestiture. Any delays in divestiture caused by the Respondent

shall extend the time for divestiture under this Paragraph III in

an amount equal to the delay, as determined by the Commission

(or, in the case of 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 Respondent’s

absolute and unconditional obligation to divest at no minimum

price. The divestiture shall be made in the manner, and to the

acquirer or acquirers, as set out in Paragraph II of this Order;

provided, however, if the trustee receives bona fide offers from

more than one acquiring entity, and if the Commission approves

more than one such acquiring entity, then the trustee shall

divest to the acquiring entity or entities selected by Respondent

from among those approved by the Commission. 

7. The trustee shall serve, without bond or other security, at

the cost and expense of Respondent, on such reasonable and

customary terms and conditions as the Commission or a court may

set. The trustee shall have authority to employ, at the cost and

expense of Respondent, 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 and all expenses

incurred. After approval by the Commission (and, in the case
12

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 Respondent 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 accomplishing

the divestiture required by this Order.

8. Respondent 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, recklessness, willful or wanton acts, or bad faith by

the trustee or his or her agent or representative.

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 III(A) 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 divestiture

required by this Order.

11. The trustee shall have no obligation or authority to operate

or maintain the Helima Assets.

12. The trustee shall report in writing to Respondent and the

Commission every thirty (30) days concerning the trustee’s

efforts to accomplish the divestiture.

IV

IT IS FURTHER ORDERED that Respondent shall not enforce beyond

one (1) year any contract for the sale of Thin-Wall Welded-Seam

Aluminum Tubes with a term greater than one (1) year
13

entered into after the consummation of the Helima Acquisition and

prior to the divestiture of the Assets To Be Divested.

V

IT IS FURTHER ORDERED that:

A. For a period of twenty (20) years from the date this Order

becomes final, Respondent shall not, in any proposed acquisition of

stock, share of capital, or production assets of any person that is a

competitor of Respondent in the design, manufacture, or sale of ThinWall Welded-Seam Aluminum Tubes, to which Respondent is a party, prior

to consummating the acquisition, obtain, seek, provide, or agree to

obtain, seek, or provide the following types of information with

respect to Thin-Wall Welded-Seam Aluminum Tubes except to the extent

that such information is publicly available: (1) current or future

Non-Aggregated, Customer-Specific Information; (2) current or future

pricing plans; (3) current or future Strategies or Policies Related to

Competition; and (4) Analyses or Formulas Used to Determine Costs or

Prices.

B. For a period of ten (10) years from the date this Order

becomes final, Respondent shall not, in any proposed acquisition of

stock, share of capital, or production assets of any person that is a

competitor of Respondent in the design, manufacture, or sale of any

product or service, to which Respondent is a party, prior to

consummating the acquisition, obtain, seek, provide, or agree to

obtain, seek, or provide the following types of information with

respect to any competing product or service except to the extent that

such information is publicly available: (1) current or future NonAggregated, Customer-Specific Information; (2) current or future

pricing plans; (3) current or future Strategies or Policies Related to

Competition; and (4) Analyses or Formulas Used to Determine Costs or

Prices. 

C. Nothing contained in Paragraphs V(A) or V(B) of this Order

shall prohibit respondent or any other person from obtaining, seeking

or providing, or agreeing to obtain, seek or provide (1) current or

future Non-Aggregated, Customer-Specific Information; (2) current or

future pricing plans; (3) current or future Strategies or Policies

Related to Competition; and (4) Analyses or Formulas Used to Determine

Costs or Prices, if such
14

information is provided to an Independent Agent. Information received

by an Independent Agent pursuant to Paragraph V of this Order may be

provided to Respondent or any other person by such Independent Agent

if such information is converted into a form that would not be in

violation of Paragraph V of this Order.

VI

IT IS FURTHER ORDERED that, for a period of ten (10) years from

the date this Order becomes final, Respondent shall not, without prior

notification to the Commission:

(a) directly or indirectly acquire any production assets of

Maschinenbau if the cumulative value of all such acquisitions in the

prior twelve (12) months exceeds $1 million; and

(b) directly or indirectly acquire any stock, share of capital,

or production assets, other than assets acquired in the ordinary

course of business, of any person engaged in the design, manufacture,

or sale of Welded Tube Mills or any person engaged in the design,

manufacture, or sale of Thin-Wall Welded-Seam Aluminum Tubes in North

America; provided, however, that an acquisition of securities will be

exempt from the requirements of this paragraph if, after such

acquisition of securities, Respondent will hold no more than five (5)

percent of the outstanding shares of any class of securities of such

person and provided further that an acquisition of assets will be

exempt from the requirements of this paragraph if the acquisition

price is less than one (1) million dollars.

VII

IT IS FURTHER ORDERED that the prior notifications required by

Paragraph VI of this Order 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 referred to as

"The Notification"), and shall be prepared and transmitted in

accordance with the requirements of that part, except that no filing

fee will be required for any such notification, notification shall be

filed with the Secretary of the Commission, notification need not be

made to the United States Department of Justice, and notification is

required only
15

of Respondent and not of any other party to the transaction. 

Respondent shall provide The Notification to the Commission at least

thirty days prior to consummating any such transaction (hereinafter

referred to as the "First Waiting Period"). If, within the First

Waiting Period, representatives of the Commission make a written

request for additional information, Respondent shall not consummate

the transaction until twenty days after substantially complying with

such request for additional information. Early termination of the

waiting periods in this paragraph may be requested and, where

appropriate, granted by letter from the Bureau of Competition.

Provided, however, that prior notification shall not be required

by Paragraph VI of this Order for a transaction for which notification

is required to be made, and has been made, pursuant to Section 7A of

the Clayton Act, 15 U.S.C. § 18a.

VIII

IT IS FURTHER ORDERED that within thirty (30) days after the date

this Order becomes final, and every thirty (30) days thereafter until

Respondent has fully complied with the provisions of Paragraphs II and

III of this Order, Respondent shall submit to the Commission verified

written reports setting forth in detail the manner and form in which

Respondent intends to comply, is complying, and has complied with

Paragraphs II and III of this Order. Respondent 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 and III of the Order, including a description of all

substantive contacts or negotiations for the divestiture and the

identity of all parties that have contacted Respondent or that have

been contacted by Respondent. Respondent 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 divestiture.

IX

IT IS FURTHER ORDERED that 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
16

other times as the Commission may require, Respondent 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 IV, V, VI, and VII of this Order.

X

IT IS FURTHER ORDERED that Respondent shall notify the Commission

at least thirty (30) days prior to any proposed change in the

corporate Respondent that may affect compliance obligations arising

out of the Order, such as dissolution, assignment, sale resulting in

the emergence of a successor corporation, or the creation or

dissolution of subsidiaries.

XI

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, to interview officers, employees, or

agents of Respondent.
17

Signed this ___ day of June, 1997.

FEDERAL TRADE COMMISSION

By:

_____________________________

Casey R. Triggs

Deputy Assistant Director

_____________________________

Nicholas R. Koberstein

Attorney

_____________________________

Katherine I. Funk

Attorney

Approved:

______________________________

Ann Malester

Assistant Director

______________________________

Mark D. Whitener

Deputy Director

______________________________

William J. Baer

Director

Bureau of Competition
18

INSILCO CORPORATION

By:

______________________________

Robert L. Smialek

President and Chief Executive

 Officer

______________________________

Linda R. Blumkin

Fried, Frank, Harris, Shriver &

 Jacobson

Counsel for Insilco Corporation
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UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

)

In the Matter of )

)

INSILCO CORPORATION, ) Docket No.

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 a corporation. )

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COMPLAINT

The Federal Trade Commission ("Commission"), having reason to

believe that respondent Insilco Corporation ("Insilco"), a corporation

subject to the jurisdiction of the Federal Trade Commission, has

acquired certain assets of Helmut Lingemann, GmbH, ("Lingemann") in

violation of Section 7 of the Clayton Act, as amended, 15 U.S.C. § 18,

and Section 5 of the Federal Trade Commission Act ("FTC Act"), 15

U.S.C. § 45; and it appearing to the Commission that a proceeding in

respect thereof would be in the public interest, hereby issues its

Complaint, stating its charges as follows:

I. DEFINITIONS

For purposes of this Complaint the following definitions apply:

1. "Welded Aluminum Tubes", including welded aluminum tubes

with diameters of 50 millimeters or greater ("Large Welded Aluminum

Tubes") and welded aluminum tubes with diameters less than 50

millimeters ("Small Welded Aluminum Tubes"), means thin wall weldedseam aluminum tubes used in the manufacture of heat exchangers, which

are devices that transfer heat from one fluid or gas to another

medium, generally air.

2. "Non-Aggregated, Customer-Specific Information" means

information about a product’s cost and/or price that is in such a form

that the cost and/or price of a product for an identifiable individual

customer can be identified.

II. THE RESPONDENT

3. Respondent Insilco is a corporation organized, existing, and

doing business under and by virtue of the laws of
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the State of Delaware, with its principal place of business at 425

Metro Place N, Box 7196, Dublin, Ohio, 43017.

4. Insilco is, and at all times relevant herein has been,

engaged in commerce as "commerce" is defined in Section 1 of the

Clayton Act, as amended, 15 U.S.C. § 12, and is a corporation whose

business is in or affecting commerce as "commerce" is defined in

Section 4 of the FTC Act, as amended, 15 U.S.C. § 44.

III. THE ACQUIRED COMPANY

5. Helima-Helvetion, Inc. ("Helima") was a corporation

organized, existing, and doing business under and by virtue of the

laws of the State of New York, with its principal place of business

having been located at Duncan, South Carolina.

6. Helima, at all times relevant herein, was engaged in

commerce as "commerce" is defined in Section 1 of the Clayton Act, as

amended, 15 U.S.C. § 12, and was a corporation whose business is in or

affecting commerce as "commerce" is defined in Section 4 of the FTC

Act, as amended, 15 U.S.C. § 44.

IV. THE ACQUISITIONS

7. On or about July 10, 1996, Insilco purchased from Lingemann

for $12.8 million the assets of Helima ("Helima Acquisition"); for $17

million, the stock of Lingemann’s European manufacturer of welded

aluminum heat exchanger tubes, ARUP Alu-Rohr und Profil, GmbH; and the

option to purchase Maschinenbau, GmbH, a Lingemann subsidiary in

Germany that manufactures mills used in the production of aluminum

tubes (together, the "Acquisitions").

8. Prior to the consummation of the Acquisitions, Insilco

requested and received from Lingemann Non-Aggregated, CustomerSpecific Information all of which is the type of information that

would likely have been detrimental to competition in the relevant

markets if the Acquisition had not been consummated.

9. The Non-Aggregated, Customer-Specific Information

transferred from Helima to Insilco included descriptions of prior

customer negotiations; detailed customer-by-customer price quotes;

current pricing policies and strategies; and detailed, customer-bycustomer future pricing strategies.
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V. THE RELEVANT MARKETS

10. For purposes of this Complaint, a relevant line of commerce

in which to analyze the Helima Acquisition is the market for Large

Welded Aluminum Tubes.

11. For purposes of this Complaint, a relevant line of commerce

in which to analyze the Helima Acquisition is the market for Small

Welded Aluminum Tubes.

12. For purposes of this Complaint, the relevant geographic

market for both relevant lines of commerce is North America.

13. Each of the relevant markets is highly concentrated. As a

result of the Helima Acquisition, Insilco is currently the only

supplier of Large Welded Aluminum Tubes with 100% of the market, and

one of only two suppliers of Small Welded Aluminum Tubes, with a

market share of over 90%.

14. There has been no entry into the market for Large Welded

Aluminum Tubes since the time of the Acquisitions, and the threat of

entry has not deterred anticompetitive effects resulting from the

Helima Acquisition. Because the cost of entering and producing Large

Welded Aluminum Tubes is relatively high compared to the limited

potential sales revenues available to an entrant, entry into this

market is not likely to be profitable. Consequently, entry into the

Large Welded Aluminum Tube market is not likely to occur in a timely

manner and counteract the additional anticompetitive effects likely to

result from the Helima Acquisition. Entry into this relevant market

is difficult and unlikely. 

15. There has been no entry into the market for Small Welded

Aluminum Tubes since the time of the Acquisitions, and the threat of

entry has not deterred anticompetitive effects resulting from the

Helima Acquisition. Additional anticompetitive effects resulting from

the Helima Acquisition are likely and will continue until such time as

actual and sufficient entry occurs .

16. Prior to the Acquisitions, Insilco and Helima were actual

competitors in the relevant markets.
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VI. EFFECTS OF THE ACQUISITION

17. The Acquisitions have substantially lessened or may

substantially lessen competition in the following ways:

a. they have eliminated Helima as a substantial independent

competitor in the relevant markets;

b. they have eliminated actual, direct, and substantial

competition between Insilco and Helima in the relevant

markets;

c. they have increased the level of concentration in the

already highly concentrated relevant markets;

d. they have led, or may lead, to increases in prices in the

relevant markets; 

e. they have led, or may lead, to a reduction in service in the

relevant markets;

f. they have led, or may lead, to the reduction in quality in

the relevant markets;

g. they have led, or may lead, to a reduction in technological

improvements in the relevant markets;

h. they have increased barriers to entry into the relevant

markets; and

i. they have given Insilco market power in the relevant

markets.

VII. EFFECTS OF INFORMATION TRANSFER

18. Insilco received from Lingemann competitively sensitive

information prior to the consummation of the Acquisitions, that, but

for the consummation of the Acquisitions, may have detrimentally

affected competition in the relevant markets.

VIII. VIOLATIONS CHARGED

19. The effects of the Acquisitions may be substantially to

lessen competition or tend to create a monopoly in violation of
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Section 7 of the Clayton Act, 15 U.S.C. § 18, and Section 5 of the FTC

Act, 15 U.S.C. § 45.

20. Insilco, through the Acquisitions, has engaged in unfair

methods of competition in or affecting commerce in violation of

Section 5 of the FTC Act, 15 U.S.C. § 45.

21. Prior to the Acquisitions, Insilco requested and received

from Lingemann Non-Aggregated, Customer-Specific Information about

customers for which they both competed in the relevant product markets

in violation of Section 5 of the FTC Act, 15 U.S.C. § 45.

WHEREFORE, THE PREMISES CONSIDERED, the Federal Trade Commission

on this _____ day of ________, 1997, issues its Complaint against said

respondent.

IN WITNESS WHEREOF, the Federal Trade Commission has caused this

Complaint to be signed by the Secretary and its official seal to be

affixed, at Washington, D.C. this ____ day of ________, 1997.

By direction of the Commission.

________________

SEAL Donald S. Clark

Secretary
Heavy-weight truck is the designation given to a truck 1

over 19,000 lbs. The Department of Transportation categorizes

such trucks as either Class 6,7, or 8 vehicles.

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ANALYSIS OF PROPOSED CONSENT ORDER

TO AID PUBLIC COMMENT

The Federal Trade Commission (the "Commission") has accepted for

public comment an agreement containing a proposed Consent Order from

Insilco Corporation ("Insilco"). The proposed Consent Order contains

a number of provisions designed to remedy the anticompetitive effects

that have resulted, and that are likely to continue to occur, because

of Insilco’s acquisition of the assets of Helima-Helvetion, Inc.

("Helima") from Helima’s German parent company, Helmut Lingemann & Co.

GmbH ("Lingemann").

THE TRANSACTION

Pursuant to a purchase agreement dated July 10, 1996, Insilco

acquired from Lingemann the assets of Helima, a New York corporation

with its only plant in Duncan, South Carolina, and the stock of ARUP

Alu-Rohr und Profil GmbH, Lingemann’s German subsidiary engaged in the

production and supply of welded-seam aluminum tubes.

THE COMPLAINT

The proposed complaint alleges that the consummated acquisition

of Helima violates Section 7 of the Clayton Act, as amended, 15 U.S.C.

§ 18, and Section 5 of the Federal Trade Commission Act, as amended,

15 U.S.C. § 45, in two relevant markets: (1) the market for weldedseam aluminum tubes with diameters of 50 millimeters or greater; and

(2) the market for welded-seam aluminum tubes with diameters less than

50 millimeters. Welded-seam aluminum tubes with diameters of 50

millimeters or greater are generally used in charged air coolers

("CAC") installed on heavy-weight trucks, whereas welded-seam 1

aluminum tubes with diameters less than 50 millimeters are generally

used in radiators. In both CAC and radiators, the welded-seam

aluminum tubes act as the heat exchange component, which is a device

that transfers heat from one fluid or gas to another medium, generally

air.
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The complaint alleges that Insilco’s acquisition of Helima gave

it a virtual monopoly or near-monopoly in these two types of weldedseam aluminum tubes. This acquisition thereby increased the

likelihood that consumers would be forced to pay higher prices for

welded-seam aluminum CAC and radiator tubes. 

A. The Welded-Seam Aluminum CAC Tube Market

In the market for welded-seam aluminum CAC tubes, Insilco’s postacquisition market share is 100%. Currently, there is no foreign

supplier of welded-seam aluminum CAC tubes shipping product into North

America, and it is unlikely that there will be such a supplier in the

next two years, or at any time in the foreseeable future. Because the

cost of entering and producing welded-seam aluminum CAC tubes is

relatively high compared to the limited potential sales revenues

available to an entrant, entry into this market is not likely to be

profitable, and is therefore not likely to occur in a timely manner to

counteract the additional anticompetitive effects likely to result

from the Helima acquisition. Indeed, there has been no entry into

the market for welded-seam aluminum CAC tubes since the acquisition of

Helima nearly a year ago, nor has the threat of entry deterred any of

the actual anticompetitive effects resulting from the acquisition. 

B. The Welded-Seam Aluminum Radiator Tube Market

In the merchant market for welded-seam aluminum radiator tubes,

Insilco’s post-acquisition market share increased to about 90%.

Although there is one foreign supplier of welded-seam aluminum

radiator tubes shipping product into North America, that supplier has

limited sales. It is highly unlikely that this supplier’s market

share will significantly expand within the next two years because of

import duties, shipping costs and time, and customer concerns about

the accessibility of the supplier. 

Entry sufficient to avert the anticompetitive effects of this

acquisition is unlikely. Indeed, there has been no entry into the

market for welded-seam aluminum radiator tubes since the time of the

Helima acquisition, and the threat of entry has not
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deterred anticompetitive effects resulting from the Helima

acquisition.

C. The Pre-Consummation Transfer Of Competitively-Sensitive 

Information

The proposed complaint also alleges that Lingemann, at Insilco’s

request, gave Insilco comprehensive competitively-sensitive

information before consummation of the acquisitions. In particular,

Helima gave Insilco customer-specific price information, current and

future pricing plans, competition strategies, price formulas, and

price strategies. This information transfer was particularly harmful

because Insilco and Helima competed against each other in two highly

concentrated markets (duopolies) and the information concerned

products that are relatively fungible. This transfer had the potential

to harm competition in the interim pre-consummation period and in the

event the acquisitions were delayed, modified, or abandoned, may have

led to even greater and more long-lasting harm. The complaint thus

alleges that the transfer of such competitively-sensitive information

in such highly concentrated markets violates Section 5.

THE CONSENT ORDER

The proposed Consent Order requires Insilco to divest two weldedseam aluminum tube mills (out of the assets acquired from Lingemann)

within four months of the date on which the proposed Consent Order

becomes final. The proposed Consent Order also prohibits Insilco from

engaging in the pre-consummation transfer of competitively-sensitive

information.

A. Divestiture Provisions

Under the proposed Consent Order, Insilco is required to divest

two welded-seam aluminum tube mills from the former Helima Duncan,

South Carolina facility. One of the mills to be divested must be

capable of producing welded-seam aluminum CAC tubes, and one must be

capable of producing radiator tubes. In addition, the package of

assets to be divested includes one set of tooling that is capable of

being used on both mills, as well as additional ancillary assets such

as machinery, fixtures,
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equipment, and software used in the maintenance and operation of the

assets to be divested. Further, Insilco must provide the acquirer

access to Insilco employees with knowledge of the Helima mills for the

purposes of training, and must sell to the acquirer sole-source spare

and replacement parts. Pursuant to a customer’s request, Insilco

would be required to divest to the acquirer the tooling used to make

that customer’s tubes. If Insilco fails to divest the package of

assets within four months after the date on which the proposed Consent

Order becomes final, the Commission may appoint a trustee to divest

all five of the mills located at the former Helima plant in Duncan,

South Carolina.

To help ensure that the acquirer has access to customers, the

proposed Consent Order includes a provision prohibiting Insilco’s

enforcement of any supply contracts that were entered into after the

acquisition and that are operative for a period greater than one year. 

Further, the proposed Consent Order requires Commission approval of

the acquirer, and requires a potential acquirer to submit a five year

business plan showing how it will use the divested assets, how it will

compete in the markets, and that the divested assets will remain and

be competitive in North America. The purpose of the divestiture is to

ensure the reinstitution of a viable, ongoing competitor to Insilco in

the markets for welded-seam aluminum CAC tubes and welded-seam

aluminum radiator tubes.

The proposed Consent Order also requires Insilco to provide the

Commission a report of compliance with the divestiture provisions of

the Consent Order within 30 days following the date the proposed

Consent Order becomes final, and every 30 days thereafter until

Insilco has completed the required divestiture.

Finally, Insilco will be required to provide prior notification

to the Commission for certain acquisitions involving tube mills or

tube producers.

 

B. Bar on Information Transfer

The proposed Consent Order prohibits Insilco from obtaining, or

providing, prior to the consummation of an acquisition or sale of an

interest in any of its businesses, customer-specific price and cost

information, current or future pricing plans, current or
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future strategies or policies relating to competition, and analyses or

formulas used to determine costs or prices. The proposed Consent

Order thus prohibits the exchange of specific types of information

that would likely harm competition in any market. The proposed

Consent Order does, however, acknowledge that a situation might arise

wherein Insilco, or a future acquisition partner, may benefit from

having access to competitively-sensitive information in order to

assess a proposed acquisition. In such a case, the party possessing

such information would be allowed under the proposed Consent Order to

transfer the information to an independent agent who will mask the

customer-specific and/or competitor-specific nature of the information

before providing it to its acquisition partner. Transferring this

type of information through an independent agent permits the benefits

of the information transfer while avoiding the potential for injury to

competition.

PUBLIC COMMENT

The proposed Consent Order has been placed on the record for 60

days for reception of comments by interested persons . Comments

received during this period will become part of the public record. 

After 60 days, the Commission will again review the agreement and the

comments received, and will decide whether to withdraw from the

agreement or make final the agreement’s proposed Order.

The purpose of this analysis is to facilitate the public comment

on the proposed Consent Order, and it is not intended to constitute an

official interpretation of the agreement and proposed Consent Order or

to modify in any way its terms.