BOSNIA & HERZEGOVINA Law and Practice Contributed by: Bojana Bošnjak-London and Nebojša Marić, Marić & Co Ltd
allows bidders to specify offer conditions while main - taining regulatory protection for minority shareholders. There are no minimum acceptance conditions for ten - der offers in Bosnia and Herzegovina. 6.6 Requirement to Obtain Financing Financing for the tender offer must be fully secured prior to launching it and the regulators will not approve a tender offer unless the funds for the acquisition of the entire outstanding shares of the target are depos - ited with the authorities, or an adequate bank guar - anty provided. 6.7 Types of Deal Security Measures Deal security measures are not governed by the laws of Bosnia and Herzegovina, and therefore the parties may agree on them at their own discretion. Although they are not commonly used, instances of non-solici - tation and break-up fees have been observed in prac - tice. 6.8 Additional Governance Rights If a bidder does not seek 100% ownership of a target company, it can negotiate various governance rights to influence the company’s operations. These rights may include board representation (allowing the bidder to appoint members to the board and participate in strategic decisions) or protective provisions requiring a supermajority for significant changes. Additionally, pre-emptive rights allow the bidder to purchase addi - tional shares before they are offered to others, thereby maintaining or increasing their ownership stake. Tag- along and drag-along rights further ensure security if other investors become involved. 6.9 Voting by Proxy Shareholders can vote by proxy in Bosnia and Her - zegovina. The form and content of the proxy are regulated by the law and form requirements must be adhered to. 6.10 Squeeze-Out Mechanisms In the Federation of Bosnia and Herzegovina and Brčko District, squeeze-out mechanisms apply only to certain joint stock companies, and only if the bidder holds 95% or more shares following a takeover offer. In Republika Srpska, the squeeze-out threshold is set
at 90% and applies to both joint stock and limited liability companies. 6.11 Irrevocable Commitments It is not common in Bosnia and Herzegovina to obtain irrevocable commitments to tender.
7. Disclosure 7.1 Making a Bid Public
As soon as the takeover threshold is achieved, the acquirer is obliged to inform the public and the regu - lator immediately (the next day) about the acquisition and the planned issuance of the takeover offer. Sub - sequently, the takeover offer must be submitted to and approved by the regulators before it is published. 7.2 Type of Disclosure Required The disclosure requirements for the issuance of shares in a business combination vary, depending on the type of entities involved (limited liability companies versus joint stock companies, regulated or non-regu - lated, etc), but generally include detailed information to ensure transparency for shareholders, regulators, and the market. If the shares are issued to the public, a prospectus is required, detailing the terms of the issuance, risks, financial statements, and the impact on sharehold - ers. This issuance is subject to regulatory approval and scrutiny, as well as regulatory filings. Further - more, public companies often issue proxy statements or circulars to inform shareholders about the share issuance, including voting rights, dilution effects, and fairness opinions. In the case of mergers, companies must disclose the terms of the transaction, including share exchange ratios, consideration structure, and any conditions precedent, as well as how the share issuance affects earnings per share, the ownership structure, and capi - tal structure. 7.3 Producing Financial Statements The need to prepare extraordinary financial state - ments depends on the nature of the corporate trans - action that is in question. For instance, in the case
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