NETHERLANDS Law and Practice Contributed by: Maarten de Boorder, Samuel Garcia Nelen, Jelmer Kalisvaart and Bas Vletter, Greenberg Traurig, LLP
Other relevant hurdles for stakebuilding in the context of a (potential) public offer are: • Mandatory Offer Threshold: See 6.2 Mandatory Offer Threshold . • Stakebuilding Disclosures: After announcement, a bidder is required to disclose any transactions in target shares, including the terms of such trans - actions and the total share interest of the bidder. In the offer memorandum, the bidder must dis - close all its transactions in target shares that were executed during the year prior to publication. • Antitrust, FDI and Regulatory Clearances: Some acquisitions may be subject to specific clearances or notification obligations. For example, the acqui - sition of an interest of 10% or more in a financial institution requires a declaration of no objection from the Dutch Central Bank or, in case the target is a bank, the European Central Bank. • Best Price Rule: If a bidder declares its offer unconditional, it must pay all tendering share - holders a price equal to the higher of (i) the price offered in the offer memorandum, including any increases (if any) and (ii) the highest price paid in transactions after announcement of the offer. This is referred to as the “best price rule”. Importantly, this rule does not apply to transactions conducted in ordinary trading on a regulated stock exchange, which means that a bidder can pay a higher price than the offer price in on-market transactions with - out having to increase its offer price. • Foreign Jurisdictional Rules: If there is substantial ownership by shareholders from other jurisdictions, the rules of those jurisdictions may be relevant to consider in addition to the Dutch rules. In practice, mainly US rules are relevant for public offers. A target will typically have US shareholders, in which case a public offer will be subject to certain US tender offer rules. The scope and extent of US regulation will depend on the level of US ownership in the target. 4.4 Dealings in Derivatives Dealings in derivatives are allowed in the Netherlands. 4.5 Filing/Reporting Obligations The disclosure obligations set out in 4.2 Material Shareholding Disclosure Threshold apply to deriva -
tives in case their value is (co-)dependent on the value of shares, they entail a right or an obligation to acquire shares or the instrument gives the holder a position that is economically similar to a shareholder. 4.6 Transparency There is no general obligation for shareholders to dis - close the purpose of their acquisition or their inten - tion regarding control of the company. The Dutch Cor - porate Governance Code includes rules that require institutional investors to disclose their engagement policy and the implementation thereof on their web - site. If someone creates the impression that it is preparing a public offer, the target can request the AFM to force the alleged bidder to publicly state its intentions. This is the so-called “put up or shut up rule”. In that case, the alleged bidder must issue a press release in which it announces a public offer or announces that it has no intention of making a public offer. If the press release states that the party in question has no intention of making an offer, they (and the persons with whom they are acting in concert) are prohibited from announcing or making a public offer for a period of six months after that press release. In case a bidder launches a public offer, the offer memorandum should include information on the inten - tions of the bidder regarding the activities, locations, employees, management and governance of the tar - get after declaring the offer unconditional. The disclosure obligations regarding M&A are gov - erned by the Market Abuse Regulation (MAR) and the Dutch Public Offer Decree ( Besluit openbare biedin - gen Wft or Bob). During the first phases of an approach, when there are confidential negotiations, inside information will be developed quickly. However, the target is often not yet required to disclose a deal because the option to delay the disclosure of inside information can be used. The disclosure of inside information may be delayed 5. Negotiation Phase 5.1 Requirement to Disclose a Deal
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