ValueAct, a San Francisco-based investment firm, has agreed to pay $11 million to settle allegations that it violated the reporting and waiting period requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR Act) during the Baker Hughes and Halliburton merger.
ValueAct’s $11 million fine is the largest ever for an HSR violation, and nearly twice as big as the previous record of $5.67 million.
According to the Department of Justice, after Baker Hughes and Halliburton announced their $35 billion merger, ValueAct purchased over $2.5 billion of voting shares in the companies without complying with the HSR Act’s notification requirements.
The complaint also details how ValueAct used its access with Halliburton and Baker Hughes senior executives to attempt to influence the companies’ proposed merger, as well as other aspects of their businesses.
“ValueAct acquired substantial stakes in Halliburton and Baker Hughes in the midst of our antitrust review of the companies’ proposed merger, and used its position to try to influence the outcome of that process and certain other business decisions,” said Principal Deputy Assistant Attorney General Renata Hesse, head of the Justice Department’s Antitrust Division.
The HSR Act imposes notification and waiting period requirements for transactions meeting certain size thresholds to ensure that such transactions undergo premerger antitrust review by the department and the Federal Trade Commission.
ValueAct Capital was founded in 2000, and manages over $16 billion on behalf of investors.
In May, Baker Hughes and Halliburton called off the merger, after federal regulators said they had objections to the combination.