PORTUGAL Law and Practice Contributed by: Bernardo Abreu Mota, David Oliveira Festas and Francisco Albuquerque Reis, CS’Associados
which, if not accepted by the controlling shareholder, entitles the minority shareholder to sell their shares to the controlling shareholder, irrespective of the latter’s acceptance, with the intervention of the Portuguese Securities Commission, for the consideration set out according to the squeeze-out rules (as mentioned above). The Portuguese Companies Code also provides for a sell-out mechanism in favour of minority shareholders if a controlling shareholder who is entitled to make a squeeze-out offer does not do so in the six-month period mentioned above. Short-Form Mergers Short-form mergers are also provided for in the Portu - guese Companies Code. Although they do not require shareholder approval if a 90% share capital threshold is met, minority shareholders who hold at least 5% of shares may still require a general meeting to be convened to ensure their right of exit in exchange for
is not feasible, even if a better offer is made. If the principal shareholder is a person whose voting rights are attributable to the offeror under Portuguese law, due to such irrevocable commitments or other cause, it will not be possible for them to launch a competing offer, unless authorised to do so by the Portuguese Securities Commission, provided that the situation that determines the attribution of the votes ceases before registration of the offer. However, it should be noted that irrevocable com - mitments are usually tailor-made to suit the parties’ needs, and their nature and terms tend to vary widely in accordance with the particular circumstances of the transaction. A takeover bid is typically made public through the publication of the preliminary announcement. Under Portuguese law, the offeror, the target company and its management, as well as any other parties involved, must ensure the confidentiality of any information relating to the offer until the preliminary announce - ment has been disclosed. The preliminary announcement of a bid must be sent by the offeror to the Portuguese Securities Commis - sion, the target company and the entity managing the market where the target is listed. The offeror must then register the offer with the Portuguese Securities Com - mission within 20 days (this deadline may be extended 7. Disclosure 7.1 Making a Bid Public The Portuguese Securities Code lists the following information that must be included in the preliminary announcement of the bid: • the identity of the offeror, the target company and the financial intermediary in charge of the offer; • the securities covered by the offer; • the consideration offered; • the stake held by the offeror in the target; • a summary of the offeror’s goals and prospects for the target and group companies, if applicable; to up to 60 days in exchange offers). 7.2 Type of Disclosure Required
fair consideration. Other Mechanisms
Other mechanisms for acquiring the shares of share - holders who have not tendered following a success - ful tender offer include stock consolidation and other corporate restructuring transactions. These measures are seldom used due to their potential for the expro -
priation of minority shareholders. 6.11 Irrevocable Commitments
In listed companies, irrevocable commitments to ten - der by principal shareholders of the target company are not often seen, due in part to their potential to trigger the obligation to launch a mandatory offer if the relevant thresholds are met. In fact, such irrevocable commitments will most certainly be regarded as act - ing in concert, thus precipitating the aggregation of voting rights under the Portuguese Securities Code. Moreover, if such commitments are enshrined in a shareholders’ agreement, they should be disclosed to the Portuguese Securities Commission, leading to the same conclusion. In light of this, irrevocable commitments are likely to be undertaken immediately before the launching of the offer, so an opt-out for the principal shareholder
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