[Federal Register Volume 60, Number 237 (Monday, December 11, 1995)]
[Notices]
[Pages 63543-63544]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-30082]



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INTERSTATE COMMERCE COMMISSION

[No. MC-F-20757]


ANR Advance Holdings, Inc.--Merger and Control Exemption--ANR 
Freight System, Inc., Transport USA, Inc., and Advance Transportation 
Company

AGENCY: Interstate Commerce Commission.

ACTION: Notice that the Commission has been requested to issue a 
finding that the cash price of $10 per share payable to the minority 
stockholders of Advance Transportation Company in connection with the 
recent merger of that corporation into ANR Freight System, Inc., is 
just and reasonable.

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SUMMARY: On November 3, 1995, Advance Transportation Company was merged 
into ANR Freight System, Inc., which has been renamed ANR Advance 
Transportation Company, Inc. The terms and conditions of the merger 
included, among other things, a ``cashing out'' of all minority 
stockholders of Advance Transportation Company at a price of $10 per 
share. The Commission has been requested to issue a finding that the 
cash price of $10 per share payable to the minority stockholders of 
Advance Transportation Company in connection with the merger is just 
and reasonable.

DATES: Comments must be filed by January 10, 1996. Replies must be 
filed by January 25, 1996.

ADDRESSES: All pleadings should refer to No. MC-F-20757. Comments (an 
original and 10 copies) should be sent to: Office of the Secretary, 
Case Control Branch, Interstate Commerce Commission, 1201 Constitution 
Avenue, N.W., Washington, D.C. 20423.<SUP>1 Comments should also be 
served (one copy each) on: (1) Warren Belmar, Fulbright & Jaworski 
L.L.P., 801 Pennsylvania Avenue, N.W., Washington, D.C. 20004; and (2) 
James F. Moriarty, Fleischman & Walsh, P.C., Suite 600, 1400 16th 
Street, N.W., Washington, D.C. 20036. Replies (an original and 10 
copies) should be sent to: Office of the Secretary, Case Control 
Branch, Interstate Commerce Commission, 1201 Constitution Avenue, N.W., 
Washington, D.C. 20423. Replies should also be served (one copy each) 
on: any persons filing comments; each of the approximately 675 
participants in the employee stock ownership plan that formerly held 
stock in Advance Transportation Company; and each of the 39 former 
employees that held stock in Advance Transportation Company immediately 
prior to the recent merger.

    \1\ Legislation to terminate the Commission on December 31, 
1995, is now pending enactment. Until further notice, parties 
submitting pleadings should continue to use the current name and 
address.
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FOR FURTHER INFORMATION CONTACT: Beryl Gordon, (202) 927-5610. [TDD for 
the hearing impaired: (202) 927-5721.]

SUPPLEMENTARY INFORMATION: The merger consummated November 3, 1995, was 
incidental to a control transaction that involved three motor carriers: 
ANR Freight System, Inc. (ANR Freight); Transport USA, Inc. 
(Transport); and Advance Transportation Company (ATC).<SUP>2

    \2\  ATC was also licensed as a broker, but its broker status is 
of no particular consequence in the present context.
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    Immediately prior to the merger and the control transaction, (1) 
ANR Freight and Transport were wholly owned direct subsidiaries of ANR 
Advance Holdings, Inc. (AA Holdings), which was itself a wholly owned 
direct subsidiary of ANRFS Holdings, Inc. (ANRFS), which was in its 
turn a wholly owned indirect subsidiary of The Coastal Corporation, and 
(2) ATC's stock was held by ``principal stockholders'' and by 
``minority stockholders.'' The ATC principal stockholders were eight 
individual family members, who collectively owned 78.4% of ATC's stock. 
The ATC minority stockholders included both an employee stock ownership 
plan (an ESOP), under which approximately 675 ATC employees were the 
beneficial owners of the stock held by the ESOP, and 39 former ATC 
employees, each of whom owned outright ATC stock that had formerly been 
held by the ESOP. The ESOP held 21.6% of ATC's stock; the 39 former 
employees held an additional 415 shares of ATC's stock.<SUP>3

    \3\  The cited figures (the 78.4% holdings of the principal 
stockholders; the 21.6% holdings of the ESOP, on behalf of 
approximately 675 ATC employees; and the 415 shares held by the 39 
former ATC employees) have varied somewhat through the course of 
this proceeding. We have therefore used the figures provided in the 
most recent pleading (the petition filed November 14, 1995), which 
we understand to represent the exact figures as they stood 
immediately prior to the merger of ATC into ANR Freight. We realize, 
of course, that the described ATC holdings add up to 415 shares 
above 100%. The context, however, suggests that either the 78.4% 
figure or the 21.6% figure has been rounded off, because the 415 
shares held outright by former employees amount to approximately 
0.07% of ATC's stock.
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    The control transaction of which the merger was a part involved the 
common control of ANR Freight, Transport, and ATC. Common control of 
these three motor carriers was obtained by AA Holdings, which already 
controlled ANR Freight and Transport, and which received, as part of 
the control transaction, the 78.4% stock ownership of ATC that had 
previously been held by the eight principal stockholders of ATC.
    In connection with and incidental to the control transaction, (1) 
ATC was merged into ANR Freight, and ANR Freight was renamed (its new 
acronym is AATC), and (2) the principal stockholders of ATC acquired 
50% of the stock of AA Holdings (prior to the transaction, ANRFS had 
held 100% of the stock of AA Holdings). In connection with and 
incidental to the merger of ATC into ANR Freight, ATC's minority 
stockholders (the ESOP and the former employees) were ``cashed out'' at 
a price of $10 per each share of ATC stock formerly held by such 
minority stockholders.
    The merger and the broader control transaction were subject to our 
jurisdiction under 49 U.S.C. 11343(a). Accordingly, by notice of 
exemption filed August 23, 1995, five parties (ANR Freight, Transport, 
AA Holdings, ANRFS, and ATC) invoked the 49 U.S.C. 11343(e) class 
exemption codified at 49 CFR Part 1186. The notice was published in the 
ICC Register on September 1, 1995 (at pages 15-16), and it indicated 
that we had exempted, subject to public comment, both the merger of ATC 
into ANR Freight and the 

[[Page 63544]]
control by AA Holdings of AATC (the renamed survivor of that merger) 
and Transport.<SUP>4 Comments were due 30 days after publication of the 
notice, but none was filed. Accordingly, the exemption became effective 
on October 31, 1995. See 49 CFR 1186.7. The merger and the control 
transaction of which it was a part were thereafter consummated on 
November 3, 1995.

    \4\ By separate decision served September 1, 1995, AA Holdings 
was authorized to assume temporary control of ANR Freight, 
Transport, and ATC pending final disposition of the exemption 
proceeding.
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    By petition filed November 14, 1995, AA Holdings and AATC 
(petitioners) request a determination verifying that the cash price of 
$10 per share payable to ATC's minority stockholders in liquidation of 
their ATC stock is just and reasonable.<SUP>5 Petitioners seek this 
determination (1) because they believe that we are required by 
Schwabacher v. United States, 334 U.S. 182 (1948), to make such a 
determination to protect minority stockholders, and (2) in order to 
immunize the ANR Freight/ATC merger from the otherwise applicable state 
law rights, particularly the otherwise applicable state law dissenters' 
rights, of the minority stockholders. See 49 U.S.C. 11341(a) (``A 
carrier, corporation, or person participating in [a transaction 
exempted under Title 49, Subtitle IV, Chapter 113, Subchapter III] is 
exempt from the antitrust laws and from all other law, including State 
and municipal law, as necessary to let that person carry out the 
transaction,'' etc.). Petitioners urge expedited handling of their 
petition.

    \5\ The petition itself references, and is accompanied by, a 
substantial document entitled ``Petitioners' Appendices,'' which we 
shall refer to as the appendix document.
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    Our statutory mandate, 49 U.S.C. 11344(c), requires, among other 
things, that we determine, in appropriate cases, that the terms and 
conditions of certain transactions affecting stockholders are just and 
reasonable. See, e.g., Union Pacific Corp. et al.--Cont.--MO-KS-TX Co. 
et al., 4 I.C.C.2d 409, 515 (1988) (``In appraising this transaction 
affecting the rights of stockholders, it is incumbent upon us to see 
that the interests of minority stockholders are protected and that the 
overall proposal is just and reasonable to those stockholders. 
Schwabacher v. United States, 344 U.S. 182, 198, 201 (1948).''). To 
move this matter to a speedy resolution, we will proceed in an 
expedited fashion.
    Because one or more of the eight principal ATC stockholders, 
although not ``minority stockholders'' in petitioners' usage of this 
term, could be ``minority stockholders'' in the Schwabacher 
sense,<SUP>6 our ``just and reasonable'' jurisdiction conceivably 
encompasses matters broader than the precise determination sought by 
petitioners. Petitioners, however, have the right to seek the narrow 
determination they have requested, and we will therefore limit our 
inquiry to the precise matter that petitioners have placed before us: 
Whether the cash price of $10 per share payable to ATC's minority 
stockholders in liquidation of their ATC stock is just and reasonable; 
and we will adhere to petitioners' usage of the term ``minority 
stockholders'' to embrace only the ESOP (under which approximately 675 
ATC employees were the beneficial stockholders) and the 39 former ATC 
employees that held ATC stock outside the ESOP.

    \6\ The eight principal stockholders owned, collectively, 78.4% 
of ATC's stock; what any one of the eight owned has not been 
indicated. Petitioners have indicated, however, that a 66\2/3\ vote 
was necessary for approval of the merger. A single principal 
stockholder acting alone could block the merger only if that 
stockholder held approximately 11.74% of ATC's stock (and any single 
principal stockholder might have been unable to block the merger 
even with 11.74% of ATC's stock; the 11.74% calculation assumes that 
no stock held by the ESOP and the former employees was voted in 
favor of the merger). It is immediately apparent that at least two 
of the principal stockholders each must have owned less than 11.74% 
of ATC's stock, because the eight principal stockholders together 
held only 78.4% of such stock.
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    Accordingly, we solicit comments from all interested persons 
respecting whether the cash price of $10 per share payable to the 
minority stockholders of ATC is just and reasonable. Such comments must 
be submitted by January 10, 1996. Petitioners may file replies to such 
comments by January 25, 1996.
    Petitioners have indicated that they will serve a copy of their 
petition (only the petition; not the appendix document) on each ESOP 
participant and on each of the 39 former employee stockholders. 
Petitioners have further indicated that they will serve a copy of the 
appendix document on any person requesting a copy. We expect that 
petitioners, if they have not completed such service of the petition 
prior to the date of publication of this notice, will complete such 
service no later than December 18, 1995.
    Petitioners have noted that, as a matter of law, Federal Register 
publication is considered to provide notice to all interested persons. 
Due process considerations, however, suggest that, whenever possible, 
identifiable interested persons should receive actual notice rather 
than constructive notice. We will therefore require petitioners to 
serve a copy of this notice on each of the approximately 675 ESOP 
participants and on each of the 39 former employee stockholders. Such 
service should be accomplished by first class mail, postage prepaid, 
and all such notices should be mailed no later than December 18, 1995.
    Petitioners should certify in writing, no later than December 21, 
1995, that they have served copies of their petition and this notice in 
the manner indicated in the two preceding paragraphs.
    Any interested person may request copies of the petition and/or the 
appendix document, in writing or by telephone, from Warren Belmar, 
Fulbright & Jaworski L.L.P., 801 Pennsylvania Avenue, N.W., Washington, 
D.C. 20004 (telephone: 202-662-0200) or James F. Moriarty, Fleischman & 
Walsh, P.C., Suite 600, 1400 16th Street, N.W., Washington, D.C. 20036 
(telephone: 202-939-7900).
    In addition to submitting an original and 10 copies of all comments 
and replies filed with the Commission, commenters and petitioners are 
encouraged to submit all pleadings and attachments as computer data 
contained on a 3.5-inch floppy diskette formatted for WordPerfect 5.1 
(or formatted so that it can be converted by WordPerfect 5.1). 
Petitioners are also encouraged to submit on such a diskette the 
petition and the appendix document (or so much thereof as can 
conveniently be submitted on such a diskette).

    Decided: December 1, 1995.

    By the Commission, Chairman Morgan, Vice Chairman Owen, and 
Commissioner Simmons.
Vernon A. Williams,
Secretary.
[FR Doc. 95-30082 Filed 12-8-95; 8:45 am]
BILLING CODE 7035-01-P