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CFIUS Filing Clearance: Micro Focus International Plc and Hewlett Packard Enterprise Company, Software Business

Status:  Clearance

Acquirer:  Micro Focus International plc (England and Wales)

Acquired:  Hewlett Packard Enterprise Company, software business (US)

Value:  Approx. US$2.3 billion

Industry:  Software

On September 7, 2016, Hewlett Packard Enterprise Company, a US technology company, announced that it had entered into definitive agreements with Micro Focus International plc, a software and technology company organized under the laws of England and Wales, pursuant to which Hewlett Packard Enterprise will transfer its software business to its directly wholly owned subsidiary Seattle SpinCo, Inc., a US company, which will later have an indirect wholly owned subsidiary of Micro Focus merged into it, such that Seattle SpincCo survives as a wholly owned subsidiary of Micro Focus.  (See Hewlett Packard Enterprise Form 8-K, Sept. 7, 2016, SEC Filing.)  The parties agreed to use reasonable best efforts to obtain CFIUS Clearance “as soon as practicable” to consummate the merger.  (Information Statement/Prospectus, Seattle SpinCo., Inc. Form 10-12G, Ex-99.1, Aug. 4, 2017, SEC Filingsee Section 7.6, Agreement and Plan of Merger, Hewlett Packard Enterprise Form 8-K, EX-2.1, Sept. 7, 2017, SEC Filing.)  Seattle SpinCo laid out the CFIUS filing timeline in its August 4, 2017 regulatory filing: “[o]n January 18, 2017, the parties to the Merger Agreement submitted a draft joint voluntary notice with CFIUS. On February 10, 2017, the parties submitted the final joint voluntary notice with CFIUS. On March 15, 2017, CFIUS provided notice to the parties that the transaction was proceeding to a second-stage, 45-day investigation, which was completed on May 1, 2017. CFIUS approved the Transactions on May 1, 2017.” (Id.) “The spin-off and the merger are currently expected to occur on September 1, 2017.”  (Hewlett Packard Enterprise Press Release, HPE Announces Details for Expected Completion of Spin-Off and Merger of its Software Business, Aug. 4, 2017.)

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