KENYA Law and Practice Contributed by: Sammy Ndolo, Njeri Wagacha and Brian Muchiri, Cliffe Dekker Hofmeyr (Kieti Law LLP)
7.2 Type of Disclosure Required Disclosure With Respect to the CMA
a notice of such intention to the minority sharehold - ers. Such notices must be given within three months starting from the day after the offer period ends or within six months from the date of the offer for offers whose timelines are not governed by the Takeover Regulations. Although the acquirer has the right to acquire the remaining shares, minority shareholders can challenge this process by appealing to the court and relying on the unfairly prejudicial or oppressive conduct provisions under the Companies Act. 6.11 Irrevocable Commitments It is standard practice to obtain irrevocable commit - ments from both major shareholders and all share - holders in general before revealing any plans to make an offer. However, if there are any agreements related to voting, they must be disclosed in the takeover documents. Such commitments would be binding for a specified period after which they lapse and the respective shareholder would be at liberty to consider an alternative offer. How and when a bid is made public depends on whether the bid is being made with respect to a pri - vate company or a listed company. In the case of a private company, there is no obligation to publicly disclose a bid according to the Companies Act. However, if the bid meets certain criteria specified in the Competition Act, the company must notify or apply to the CAK and as part of the approval process, the CAK will issue a notice in the Kenya Gazette. It is possible for applicants to designate certain informa - tion as confidential when notifying the CAK by submit - ting a confidentiality claims form, in order to prevent it from being publicly disclosed. 7. Disclosure 7.1 Making a Bid Public With respect to listed companies, a bid should be made public within 24 hours from the resolution of the acquirer’s board to acquire effective control of the listed company. This is done through a press notice and serving the notice of intention to the listed com - pany, NSE and CMA, and where the acquirer and the target are in the same business to the CAK.
The Takeover Regulations specifically provide that the following is required to be disclosed to the CMA: • identity of the acquirer and all related companies or persons acting in concert or associated with the proposed acquirer; • the identity of the listed company; • the exchange at which the shares are listed; • whether the acquirer intends to make a takeover offer or apply to the CMA for exemption from mak - ing a takeover offer; • the type and total number of voting shares of the listed company: (a) which are held or controlled directly or indirect - ly by the acquirer or any related companies; (b) in respect of which the acquirer or any related company or any person acting in concert with the acquirer has received an irrevocable undertaking from other holders of voting shares to which the takeover relates to accept the takeover offer; and (c) in respect of which the acquirer or any related company or any person acting in concert with the proposed offeror has an option to acquire; • the details of any existing or proposed agreement, arrangement or understanding; and • the conditions of the takeover offer, including con - ditions relating to acceptances, listing and increase of capital. Disclosure With Respect to the CAK When disclosing a bid to the CAK, the applicants (the acquirer and listed company) will be required to lodge: • the documents highlighting the agreement/arrange - ment/understanding pertaining to the bid; • audited financial statements of both the acquirer and the listed company for the last three years; and • information on both the applicants’ business along with information on the market share held. The same level of disclosure will be required of a private company if it falls within the threshold of the Competition Act.
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