EGYPT Law and Practice Contributed by: Mohamed Hashish, Heba El Abd and Mariam Rabie, Soliman, Hashish & Partners
6. Structuring 6.1 Length of Process for Acquisition/Sale The timing of the process of acquiring or selling a business primarily depends on the mode of its execu - tion and the parties’ agreement, without prejudice to any legally required timeline. In the acquisition of pri - vate companies, the process for the transfer of shares usually takes up to five days from the receipt by the broker of the share transfer documents. However, in a public tender offer, the duration of the offer is typically within 30 days, including the period of review and approval of the FRA of the application made by the bidder and the launch of the tender offer by publication on the screens of the EGX. The review process by the ECA and/or FRA (as the case may be) for clearing notifiable economic con - centrations should also be taken into consideration, which may take up to 60 days as of the date of sub - mitting the notification file to the relevant authority. 6.2 Mandatory Offer Threshold Under Egyptian law, with respect to companies sub - ject to oversight by the FRA, a mandatory tender offer obligation is triggered when a person, whether directly or through its related parties: • acquires one-third or more of the share capital or voting rights of the target company; • holds more than one-third but not more than half of the share capital or voting rights of the target company, and within 12 consecutive months, its ownership exceeds 5% above its existing stake; • exceeds half of the share capital or the voting rights of the target company at any given time; • holds more than half but not more than two-thirds of the share capital or voting rights of the target company, and within 12 consecutive months, its ownership exceeds 5% above its existing stake; • holds more than two-thirds but not more than three-quarters of the share capital or voting rights of the target company, and within 12 consecutive months, its ownership exceeds 5% above its exist - ing stake; or • exceeds three-quarters of the share capital or vot - ing rights of the target company at any given time.
reasonable person, unless the purchaser proves that the seller affirmed the absence of those defects. There is no typical scope of due diligence in Egypt as it depends on the level that the buyer is willing to con - duct. However, conducting full due diligence is usually recommended in order to be in line with the general rule outlined above, including financial and legal due diligence. Buyers can rely on due diligence reports produced by the sellers if the sellers conduct the due diligence with the care of a reasonable person. 5.4 Standstills or Exclusivity Generally, the use of standstills and exclusivity agree - ments in Egypt is not explicitly regulated. However, such agreements may be used to provide a certain level of assurance for the parties involved. However, it is worth noting that in all cases such agreements must be in compliance with the applicable laws in Egypt, the relevant disclosure and transparency obligations under Egyptian laws and the company’s constitutional documents, which may restrict such actions. 5.5 Definitive Agreements As a general rule, a contract is created, subject to any special formalities that may be required by law for its conclusion, from the moment that two persons have exchanged two concordant intentions. Note that an intention may be declared verbally, in writing, by signs in general use, and also by such conduct as, in the circumstances of the case, leaves no doubt as to its true meaning. A declaration of intention may be implied when neither the law nor the parties require it to be expressed. Generally, pursuant to the Civil Code, the contract is the law of the contracting parties, and it may not be revoked or modified except by agreement of the two parties, or for reasons determined by law. In all cases, the definitive agreement must comply with Egyptian laws.
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