SWEDEN Law and Practice Contributed by: Louise Rodebjer, Ólafur Steindórsson, Per Dalemo and Johannes Wårdman, CMS Wistrand
percentage of voting rights than previously set out, due to the fact that not all shareholders will be pre - sent and cast their votes at the general meeting. In practice, the ability to control a company through a lower shareholding percentage depends on the overall ownership structure. It is easier to exercise control in a company with a widespread ownership consisting of a large number of shareholders holding small amounts of shares each. In addition to gaining control by pur - chasing more shares, a shareholder may acquire gov - ernance rights by entering into voting agreements with other shareholders. 6.9 Voting by Proxy In Sweden, shareholders may vote by proxy. Under the Swedish Companies Act, a shareholder not pre - sent at a general meeting may appoint a proxy through a written, signed and dated power of attorney. Such power of attorney may not be older than one year, unless a longer validity period – up to five years – is expressly stated. As a general rule, companies may not engage in proxy solicitation. This prohibition aims to prevent the board from using company resources to influence voting outcomes at general meetings. Swedish law further allows general meetings to be conducted entirely by digital means. Subject to authorisation in the articles of association, compa - nies may hold entirely online-based general meet - ings, which is particularly practical for companies with an international shareholder base. That said, there remains a strong cultural preference in Sweden for physical shareholder meetings, particularly among listed companies. Proposals by certain larger listed companies to introduce provisions in their articles of association permitting fully digital meetings have Under the Swedish Companies Act, a sharehold - er holding more than 90% of the shares may initi - ate a squeeze-out of minority shareholders, who have a corresponding right to require a buyout. This right applies regardless of whether the shares were acquired through a public offer or otherwise. therefore attracted vocal criticism. 6.10 Squeeze-Out Mechanisms
If a majority shareholder initiates a squeeze-out and the minority disputes the redemption or the price, the matter is referred to arbitration. The arbitral tri - bunal determines, among other things, the valid - ity of squeeze-out, any right to early access to the shares, and the final redemption price. The proceed - ings are conducted under the Swedish Arbitration Act (1999:116), unless otherwise provided in the Compa - nies Act, and conclude with an arbitral award transfer - ring ownership to the majority shareholder. 6.11 Irrevocable Commitments In takeover situations, offerors may seek to secure commitments from major shareholders through irrevo - cable undertakings, whereby the shareholder agrees to accept the offer if it is made. Such agreements can be negotiated before a formal offer is submitted, strengthening the offeror’s position and increasing deal certainty. While some irrevocable undertakings are unconditional, others may include outs, allowing shareholders to withdraw their commitment if a supe - rior competing offer arises. Under Swedish takeover rules, the offeror must dis - close the extent to which binding or conditional com - mitments to accept the offer have been secured from shareholders of the target company, or whether share - holders have expressed positive statements regarding the offer.
7. Disclosure 7.1 Making a Bid Public Public Takeover
Once the offeror has decided to make a takeover offer and entered into an undertaking with the regulated market to comply with the applicable takeover regula - tions, it must announce the offer as soon as possible. The main terms to include in such announcement are (for example): • the price; • any premium, alongside its calculation;
• how the offer is financed; and • any conditions for completion.
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