FRANCE Law and Practice Contributed by: Bertrand Barrier, Anne Toupenay-Schueller and Cyril Deniaud, Jeantet
11.4 Independent Outside Advice In France, it is common practice for a board of direc- tors to seek external legal, financial and strategic advice in the context of a takeover or a business com- bination in order to guide the board with respect to feasibility/strategic implications and the organisation of the contemplated transaction in a structured form. Any such external advice will be additional to the advice of the independent expert who may be appointed by the board of directors to draft a report containing the independent expert’s fairness opinion in the framework of the tender offer (see 6.4 Consid- eration and Minimum Price , 6.6 Deal Documentation and 11.2 Special or Ad Hoc Committees ). In specific situations, such as mergers or contribu- tions in kind, French law requires the appointment of independent auditors who will be in charge of issuing reports on the value of the assets or shares involved. This reliance on independent legal, financial and strategic advice helps to mitigate litigation risks and supports the board in demonstrating that it has acted diligently and in the best interests of the company and its shareholders.
as long as the defensive measures comply with the company’s interest and do not undermine the com- petence of the shareholders’ meeting. Litigation in M&A transactions in France remains rela- tively uncommon, but it does occur in certain circum- stances, particularly in contentious takeovers or when disputes arise over deal execution. French corporate law’s emphasis on shareholder protection, combined with the AMF’s regulatory oversight, generally help to prevent major conflicts – but when they do arise, they tend to involve specific legal and financial issues. In France, shareholder activists occasionally attempt to interfere with the completion of announced M&A transactions, though such interference remains rela- tively rare compared to markets like the US. When shareholder activists do get involved, this typically takes the form of public campaigns or legal actions aimed at influencing deal terms or blocking transactions perceived as undervaluing the target company. Activists may challenge the fairness of the offer price, argue against strategic misalignment, or push for alternative bids. They can also urge boards to rene- gotiate terms or to improve governance commitments post transaction. In some high-profile cases, institu- tional investors have sided with activists to require better financial or ESG considerations before support- ing a deal.
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