FINLAND Law and Practice Contributed by: Christoffer Waselius and Niko Markkanen, Waselius
4.4 Consideration and Minimum Price Public Tender Offers The consideration in a mandatory takeover bid must be an equitable price, consisting of cash, securities or both. When determining what an equitable price would be, the highest price paid by the offeror dur- ing the six months preceding the obligation to launch a bid (refer to 4.2 Mandatory Offer ) is used as the basis for the determination. If no securities have been acquired by the offeror during said period, the average of the prices paid for the securities in trading weighted by the volume of the trade during the three months preceding the obligation to launch a bid shall be used as a basis in the determination. The consideration in a voluntary bid may also consist of cash, securities or both, except for in certain situa- tions where a cash component must be offered, typi- cally where the securities offered as consideration are not traded in a public marketplace. The basis for the determination of the consideration shall be the highest price paid by the offeror during the six months preced- ing the announcement of the takeover bid. In Finland, the consideration has usually been paid in cash. Mergers The merger consideration is usually paid in shares despite the Finnish Companies Act also allowing cash, assets or other commitments as consideration. The merger consideration is agreed upon between the merging parties in the merger plan. 4.5 Common Conditions for a Takeover Offer/ Tender Offer Typical conditions in Finnish tender offers are as fol- lows: • A minimum acceptance rate (often above 90%) has been reached. • The relevant regulatory approvals have been obtained. • No material adverse change has occurred after the announcement. • No authority or court decisions have been given and no other legislation has been issued that would
prerequisites for the FIN-FSA to set such deadline is that information concerning the potential of a takeover bid is likely to disrupt the normal functioning of the securities markets or interfere with the target compa- ny’s business operations for an unreasonable amount of time. If the takeover bid is not disclosed or confirmation that no takeover bid will be pursued is disclosed by the deadline set by the FIN-FSA, the relevant person can- not launch a takeover bid for a period of six months If a shareholder’s voting rights in a company listed on a regulated market or a multilateral trading facility exceed 30% or 50% of the total voting rights of the target company, said shareholder is obligated to make a public offer for all shares in the target company. In addition, if a shareholder’s shareholding in the tar- get company exceeds 90% of all outstanding shares and votes, such shareholder has the right to redeem the rest of the shares in the target company and is obligated to do so upon a request by the minority shareholders. 4.3 Transaction Structures A public company is typically acquired through a pub- lic takeover or merger. Mergers are, perhaps, more commonly used in acqui- sitions of public companies than public takeovers. In recent years, it has become quite common in Finland for a public company to be acquired by means of a merger. The merger process is quite strictly regulated in the Finnish Companies Act (624/2006, as amend- ed), providing for certain measures with the intent of protecting minority shareholders and creditors. A merger must be approved by the general meeting of shareholders of the merging company by a 2/3 major- ity of the votes cast and of the shares represented at the meeting as well as of each share class rep- resented at the meeting. Depending on the circum- stances, the merger must be resolved upon by either the shareholders’ meeting or the board of directors of the receiving company. following the deadline. 4.2 Mandatory Offer
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