KENYA Law and Practice Contributed by: Sammy Ndolo, Njeri Wagacha and Brian Muchiri, Cliffe Dekker Hofmeyr (Kieti Law LLP)
the approved takeover offer document to distribute to its shareholders. The offer must be available for acceptance for 30 days after it is delivered. • The target shall within 14 days from the date of receipt of the approved takeover offer document circulate it to its shareholders together with an independent adviser’s circular. • Within ten days of the end of the offer period, the acquirer must notify the CMA and the NSE and issue a press release announcing the acceptance and the resulting change in structure. If an M&A transaction requires competition approval, the CAK must make a decision on transactions within 60 days of receiving a notification or if any additional information is requested, within 60 days of receipt of the additional information. Where a hearing confer - ence is convened, the decision should be made within 30 days of concluding the hearing conference. CAK may extend the approval period, but it must not be longer than 60 days. For regional M&A transactions requiring CCCC approval, the CCCC is required to investigate a merger as soon as the notification (which must be complete) is received and to make a decision on the notification within 120 days, subject to any extensions approved by the CCCC’s board. Furthermore, it is mandatory for the parties involved in the regional M&A transaction to inform the CAK about the submission of the merger filing to the CCCC within 14 days from the date of submission. Effective 1 November 2025, regional M&A transactions within the EAC which meet the prescribed threshold require EACCA approval. The EACCA is mandated to investigate a merger and communicate its final deci - sion within 120 business days of issuing a notice of complete filing and thereby provides a predictable framework for cross-border transactions. 6.2 Mandatory Offer Threshold The Takeover Regulations prescribe that a person is presumed to have a firm intention to take over a list - ed company if the person acquires shares in a listed company which together with the shares already held by associated persons or related companies or per - sons acting in concert, will result in “acquiring effec -
tive control” of the listed company. The threshold of “effective control” is control of 25% of the shares of a listed company. The Takeover Regulations also prescribe other cir - cumstances under which a person is presumed to have a firm intention to make a takeover bid. These are set out in 4.1 Principal Stakebuilding Strategies . CMA Exemption The Takeover Regulations empower the CMA to grant exemptions to an acquirer from making a mandatory takeover offer for all the shares of a target subject to conditions, where it serves the wider interests of shareholders and the public. Circumstances where exemption may be granted include the following. • Strategic investment – acquisition tied to manage - ment or technical support relevant to the com - pany’s business. • Management buy-out – involving a majority of the employees of the offeree. • Restructuring – share capital reorganisation, amal - gamation, or other schemes approved by CMA. • Financial distress – acquisition of a listed company in financial difficulty. • Disposal of pledged securities – acquisition arising from enforcement of security interests. • Maintenance of domestic shareholding – for strategic reasons, such as safeguarding national interests. • Other public interest grounds – any circumstance which, in CMA’s opinion, serves the wider public interest. 6.3 Consideration Both payment in cash and by way of share swap is acceptable in Kenya. With respect to public M&A, the Takeover Regulations provide that the mode of pay - ment would need to be set out in the takeover offer document. The acquirer may vary the terms of the takeover offer including increasing the consideration offered at least five days before the closure of the offer period. In private M&A, parties may negotiate an earnout or deferred payment mechanism where the sellers will get additional payment in future upon the target
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