POLAND Law and Practice Contributed by: Agnieszka Janicka, Krzysztof Hajdamowicz and Jarosław Lorenc, Clifford Chance LLP
greatly increases the likelihood of a tender offer suc - ceeding in the absence of a higher competing bid. If, however, a takeover is “hostile”, the position of the management board may discourage shareholders from taking part in the tender offer and the outcome of the tender offer is sometimes unknown until the final moment of the bid. Management boards of target companies may obtain an external fairness opinion in order to provide the reasoning behind the board’s view on the tender offer (but are not required to do so). However, this is not common practice in Poland, and it is generally more frequent in the case of hostile or competing bids, or where the members of the management board may have some interest in the transaction. If the manage - ment board seeks a fairness opinion, it must also dis - close it to the public (full disclosure of the received opinion is required). In transactions structured as an acquisition of the business as a going concern, members of the man - agement board will be responsible for agreeing the commercial terms in the interest of the relevant com - pany. Similarly, in the case of mergers and demergers the members of the management board of the participat - ing entities will be responsible for agreeing the merg - er/demerger plan (ie, agreement setting the framework for the merger/demerger) and for the subsequent implementation steps (subject to the sharehold - ers’ approval). Some further obligations may apply, depending on the structure of the merger/demerger and if the company is listed. 8.2 Special or Ad Hoc Committees There is no established market practice for manage - ment or supervisory boards to establish special or ad hoc committees in the context of an announced tender offer. This may happen in the case of foreign companies listed in Poland rather than in the case of Polish companies. 8.3 Business Judgement Rule Given the limited role of management in takeover situ - ations in Poland, there is usually no deference at all
to the judgement of the board of directors in takeover situations. 8.4 Independent Outside Advice Directors (especially members of the management board) often seek advice as to their overall role in the transaction and providing confidential and commer - cially sensitive information to investors. 8.5 Conflicts of Interest There have been no cases of conflicts of interest of directors, managers, shareholders or advisers being the subject of judicial or other scrutiny in Poland in the context of major M&A transactions. However, liability cannot be ruled out. Tender offers to purchase shares in a company listed on the WSE can either be recommended by the man - agement board of the target company or be hostile. However, Polish law does not distinguish between the procedures for recommended and hostile tender offers. A bidder who does not anticipate co-operation from the target company’s management board can only rely on publicly available information on the target com - pany. Because prospective bidders seldom decide to rely solely on publicly available information, purely hostile takeovers are not common in Poland. 9.2 Directors’ Use of Defensive Measures Directors are free to apply defensive measures in prin - ciple. 9. Defensive Measures 9.1 Hostile Tender Offers However, the articles of association of a listed com - pany may provide that, during the tender offer pro - cedure, the management board and the supervisory board require the consent of the shareholders’ meet - ing to take actions aimed at making the tender offer unsuccessful (except for actions aimed at another investor launching a competitive tender offer). The articles of association may also provide that, under certain circumstances, restrictions on voting
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