NORWAY Law and Practice Contributed by: Fredrik Lykke, Christian P. N. Fenner and Magnus Brox, Advokatfirma DLA Piper AS Norway
to note that the bidder, upon the resolution to carry out the squeeze-out, irrespective of a disputed share price and prior to the two-month period, becomes owner of the shares, and, therefore, that from such date, has full control over the target company and may initiate the de-listing from the stock exchange. A dispute with the minority shareholders subject to the squeeze-out will thus only concern the amount to be paid for the acquired shares. In events where there has been a customary takeover process with accept - ances of most shareholders and the squeeze-out is initiated within three months from the end of the offer period, the main rule is that the squeeze-out price shall be the same as the tender offer price. In more complex situations, in which the fact that a bidder obtains in excess of 90% does not itself indicate that the offer price was on an arm’s length basis, the courts may conclude on a higher price and the bidder will be bound to pay such amount to the minorities. Other mechanisms to secure ownership of additional shares can be mergers and combinations with other assets of the majority shareholder and/or directed share issues to dilute minorities to under the 10% threshold. Typically, such processes create issues concerning arm’s-length terms and often the bidder instead waits a certain period and reverts with new offers and gradually obtains more than 90%. 6.11 Irrevocable Commitments As discussed in 4.1 Principal Stakebuilding Strate- gies , it is quite common to obtain irrevocable commit - ments to tender. The customary process is that nego - tiations are ongoing for a while with representatives of significant shareholders (who are often also directors of the target company) and discussions concerning the irrevocable commitments are part of the main dis - cussions. Typically, both target and bidder want to secure additional irrevocable commitments also from “professional outsiders”. Such investors (often fund managers) will typically be approached a couple of days before planned launch after having agreed to become insiders.
Typically, the irrevocable commitments are “soft”, meaning that they lapse as not binding if a better offer is made and not matched by the initial bidder.
7. Disclosure 7.1 Making a Bid Public
It follows from Chapter 6 of the Securities Trading Act that when a bidder has resolved to make a voluntary bid, the takeover authority and the target company shall immediately be notified and the takeover author - ity shall make information about the offer public. The target company is also obligated to immediately make the offer public. When transaction agreements are entered into, there is a co-ordinated public announce - ment. 7.2 Type of Disclosure Required Disclosure requirements in connection with issuance of shares in a business combination depend heavily on the situation. If shares are offered to more than 150 persons, and the value thresholds are met while the exceptions do not apply, the issuer will have to prepare a full EU prospectus in compliance with the Prospectus Directive. However, if shares are only issued to one other par - ty in a business combination, there are no specific disclosure requirements. The issuer does, however, have a general duty to provide the subscriber with key information regarding the issuer and its business. Otherwise, it is up to the receiver of shares to consider the extent of its due diligence. If the business combination is done by way of formal statutory merger, the parties will have to enter into a merger plan and have this approved by the respective general meeting of the two (or more) merging enti - ties. There are detailed rules concerning content of the merger plan and its exhibits, which includes inter alia the latest annual reports and accounts, valuation principles and consequences for the merging entities and their employees. 7.3 Producing Financial Statements There is no requirement for the bidder to include finan - cial statements concerning itself (except when it is
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