SWEDEN Law and Practice Contributed by: Louise Rodebjer, Ólafur Steindórsson, Per Dalemo and Johannes Wårdman, CMS Wistrand
Public M&A Transactions In the case of a public takeover, the offer document must be made public, and the board of the target company is required to disclose its opinion on the offer, along with the reasons for this opinion, at least two weeks before the expiry of the acceptance period.
Simultaneously, the information must be submitted to the stock exchange and the Financial Supervisory Authority. In the event of a mandatory offer, the offeror must immediately disclose their shareholding in the com - pany and, within four weeks thereafter, make a public offer for the remaining shares. Inside Information The MAR regarding inside information also applies to takeover offers, as the offers may constitute inside information (see 5.1 Requirement to Disclose a Deal ). 7.2 Type of Disclosure Required The Prospectus Regulation stipulates a requirement to publish a prospectus if the public offer includes remuneration in newly issued shares in the offeror. A prospectus must be made publicly available prior to offering securities to the public or admitting securities to trading on a regulated market. However, there are several exceptions which, if applicable, result in the publication of a prospectus not being mandatory. 7.3 Producing Financial Statements The previously mentioned prospectus (see 7.2 Type of Disclosure Required ) contains information about the issuer’s assets and liabilities, profits and losses, and its financial position and future outlook. 7.4 Transaction Documents Private M&A Transactions In a private transaction, there is no obligation for doc - uments to be made publicly available. However, other transaction-related documents – such as corporate documentation produced to facilitate amendments to the board of the target or changes in the articles of association – become accessible for the public once filed for registration. This is due to the Swedish princi - ple of public access to information, which ensures that documents held by public authorities are classified as public records. In certain instances, documents pertaining to individuals’ business or operational cir - cumstances may be subject to confidentiality if there is a reason to believe that disclosure of the information could harm the individual – for example, in terms of competitive disadvantages.
8. Duties of Directors 8.1 Principal Directors’ Duties
Directors owe fiduciary duties to the company and all shareholders. They must act in the best interest of the company as a whole, ensure equal treatment of shareholders, and avoid granting undue advantages to specific shareholders or third parties to the detri - ment of the company. In public takeover situations, directors must act in the interest of all shareholders and may not pursue per - sonal interests or favour one shareholder or compet - ing offeror over another. Under Chapter 5 of the Act on Public Takeovers, the board may not, without share - holder approval, take measures if such measures are likely to adversely affect the conditions for launching or implementing the offer. 8.2 Special or Ad Hoc Committees In Sweden, the use of independent bid committees is relatively common, especially when conflicts of inter - est arise. While not mandatory, these committees ensure fairness and objectivity when evaluating offers presented to the company. In such cases, the commit - tee protects the interests of minority shareholders and ensures an impartial evaluation of the offer. 8.3 Business Judgement Rule The approach in Swedish law has been that, in princi - ple, a board member should not be liable for damages for bad business. However, according to the Companies Act, a share - holder who has suffered damage as a result of a director’s wilful misconduct or negligence in the per - formance of their duties is entitled to compensation. Thus, a distinction needs to be made between wheth - er it was a merely a bad business decision or whether the board member acted in misconduct or negligence.
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