BAHAMAS Law and Practice Contributed by: Michelle Neville-Clarke, Lethea Carey and Stan Burnside, Lennox Paton
6. Structuring 6.1 Length of Process for Acquisition/Sale Acquiring a business in The Bahamas typically spans between one and six months, depending largely on whether the buyer is a Bahamian citizen or a non- Bahamian investor. For local buyers, the process is relatively streamlined, involving due diligence and a Business Licence transfer that usually takes four to eight weeks; however, non-Bahamian acquisitions must navigate additional regulatory hurdles, includ - ing a mandatory project proposal submission to the Bahamas Investment Authority (BIA) for National Economic Council approval, which alone carries a 60-day turnaround time. When factoring in Central Bank exchange control approvals and final licensing through the Department of Inland Revenue, foreign- led transactions generally require a more extensive timeline of four to six months to reach completion. 6.2 Mandatory Offer Threshold There is no mandatory offer threshold in The Baha - mas. 6.3 Consideration In The Bahamas, cash is more commonly used than shares in takeovers and private acquisitions. Share consideration typically arises in strategic mergers or reorganisations, but pure share-for-share offers are rare, as cash provides pricing certainty and avoids valuation disputes in a concentrated investor base. To address valuation uncertainty, common in real estate, tourism, financial services or early-stage ven - tures, parties may use earn-outs, escrows, holdbacks, deferred consideration, vendor loan notes, equity roll - overs and completion account adjustments, allocating risk and aligning incentives while enabling transaction completion. 6.4 Common Conditions for a Takeover Offer In The Bahamas, takeover offers are governed by the Securities Industry Act, 2024, with oversight by the Securities Commission and, for listed companies, the Bahamas International Securities Exchange rules. Offers typically include minimum acceptance condi - tions – often over 50% for control and 90% for statu - tory squeeze-out – as well as regulatory approvals,
no material adverse changes, accuracy of disclosed information and absence of insolvency or material litigation. Share consideration may also require the bidder’s shareholder approval. Mandatory rules protect minority shareholders: acquir - ing a specified voting threshold, commonly 30%, can trigger a mandatory offer to remaining shareholders on terms at least equal to the highest price paid by the acquirer in a prior period, ensuring fair treatment and preventing creeping acquisitions. 6.5 Minimum Acceptance Conditions A business combination in The Bahamas can legally be made conditional on the bidder obtaining financ - ing. As there are no statutory takeover regimes or mandatory offer rules, the conditions of a deal (includ - ing financing) are entirely contractual and negotiated between the parties. It is common practice for agree - ments to include a financing condition to protect the bidder in transactions where the purchase price depends on securing debt, equity or other funding. 6.6 Requirement to Obtain Financing Bidders in The Bahamas can utilise various deal secu - rity measures common in international M&A, primar - ily governed by the Securities Industry (Take-over) Rules, 2019. Please note that these Rules apply in any take-overs involving a public issuer that is listed on a domestic exchange, is operating on the over- the-counter market, or has made a public offer. The Securities Industry (Take-over) Rules, 2019, provide a clearer, more structured framework for formal bids, which helps standardise timelines but may extend them if additional regulatory approvals (such as those from the Securities Commission of The Bahamas and the Central Bank of The Bahamas) are required. 6.7 Types of Deal Security Measures In The Bahamas, a bidder that does not seek 100% ownership of a target may obtain additional govern - ance rights through contractual arrangements and amendments to the target’s constitutional documents, including its Memorandum and Articles of Associa - tion. These rights are commonly set out in a share - holders’ agreement to regulate relationships among shareholders and supplement statutory protections. Typical governance rights include board representa -
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