NIGERIA Law and Practice Contributed by: Tosin Ajose, Izuchukwu Ubadinma, Deborah Leshi and Precious Omope, DealHQ Partners
7.2 Restrictions Due diligence of an energy and infrastructure compa- ny may be limited by data protection rules, regulatory restrictions and contractual confidentiality obligations. The Nigeria Data Protection Act 2023 does not restrict due diligence, but parties must: • have a lawful basis for processing personal data; • implement appropriate confidentiality and security safeguards; and • apply data-minimisation and anonymisation princi- ples where possible. In addition, sector regulators impose control on access to operational and technical data. The NUPRC’s Nation- al Data Repository Regulations 2024 classify oil and gas reserves, production volumes and well test results as proprietary or national security information, and man- date strict controls on who can access such data dur- ing the due diligence phase. Likewise, the NERC limits the disclosure of information on power plant operational metrics, grid stability data, distribution network capacity and customer consumption patterns. In Nigeria, the requirement for public disclosure arises when any person or group of persons acting in con- cert acquires shares carrying 30% or more of the vot- ing rights in a public company. This applies whether the acquisition occurs through a series of transactions or through a single transaction. Even an intention to acquire shares that would reach or exceed the 30% threshold requires compliance with bid procedures. In this case, the bidder must apply to the SEC for authority to proceed with the bid within three business days of reaching or proposing to reach the threshold. Subsequently, the intention to make the takeover bid must be publicly announced in at least two national daily newspapers and on the target company’s web- site, and formally announced on the floor of the secu- rities exchange where the target’s shares are listed. The announcement must include key information such as the bidder’s identity, the offer price and the per- centage of shares sought. 8. Disclosure 8.1 Making a Bid Public
Voluntary Bid Disclosure A bidder proposing a voluntary takeover offer (before the mandatory 30% threshold) must also engage with the SEC before making the bid public. No takeover bid, whether mandatory or voluntary, can lawfully proceed without first obtaining “authority to proceed” from the SEC. A voluntary bid is announced after this is obtained. Private Companies For private companies, there is no general require- ment of public disclosure of the bid inventions or transaction terms in the manner mandated for pub- lic company takeovers. Disclosure is typically limited to post-completion filings with the CAC and, where applicable, relevant sector regulators to reflect all changes. 8.2 Prospectus Requirements When a bidder offers its shares as consideration (stock-for-stock transaction) in a takeover offer, it is required by law in Nigeria to prepare and issue a pro- spectus approved by the SEC. The Investment and Securities Act, 2025, mandates the registration of all securities offered to the public, including shares issued as consideration in takeovers. Shares being used as consideration for a public com- pany would generally need to be listable or follow specific SEC-approved issuance processes (like a private placement to select investors with shareholder approval). Transactions involving only Nigerian private companies have fewer capital market regulations, and the shares do not need to be listed on any exchange. Foreign buyers are not mandated to be listed on the NGX for the purpose of M&A. They could rely on equiv- alent listings in other jurisdictions, provided that such exchanges meet comparable regulatory standards and are approved by the SEC. The offer and underly- ing securities would still be registered with the SEC. 8.3 Producing Financial Statements Bidders involved in stock-for-stock transactions or a takeover bid for a public company must provide their audited financial statements and, in some cases, pro forma statements to show the financial impact of the transaction. This is a part of the documentation sub-
311 CHAMBERS.COM
Powered by FlippingBook