ITALY Law and Practice Contributed by: Paolo Balboni, Luca Bolognini, Giulio Monga and Carmine Antonio Perri, ICT Legal Consulting
regulatory certainty. Mergers are, however, frequently used after the completion of an OPA, particularly for integration or restructuring purposes – for example, to merge the target into the bidder or a newly formed special-purpose vehicle (reverse merger) as part of the post-delisting process. 6.4 Consideration and Minimum Price While the Italian TUF admits stock-for-stock transac- tions ( offerte pubbliche di scambio or OPSs), cash consideration remains the most common form of pay- ment in Italian public M&A. In particular, according to an occasional report issued in 2024 by Consob, within the period 2020–2023, 92% of public offers were set- tled entirely in case, while pure OPSs accounted for only 4%, and mixed cash-plus-titles offers ( offerte pubbliche di acquisto e scambio or OPASs) repre- sented about the remaining 4%. Cash consideration is also acceptable in statutory mergers or restructuring transactions under Articles 2501ff of the Civil Code. Pursuant to Articles 106 (2)– (3-bis) TUF and Consob Regulation No 11971/1999, the consideration in a mandatory tender offer must be at least as high as the highest price paid by the bidder (or persons acting in concert) for the same shares in the prior 12 months. Consob may permit deviations in extraordinary cases. The already mentioned reform proposal for 2025 suggests shortening the reference period to six months. Contingent value rights and sim- ilar mechanisms are very rare in public offers, espe- cially considering, under Article 103 (1) TUF, they must be addressed, on equal terms, to all holders of the financial instruments that are their object (so-called principle of equal treatment of shareholders). 6.5 Common Conditions for a Takeover Offer/ Tender Offer Under Article 103 (1) TUF, a takeover offer is irrevoca- ble, and any clause to the contrary is void. Pursuant to Article 40 (1) of Consob Regulation No 11971/1999, an offer may be subject to conditions only if such conditions are not dependent on the bidder’s discre- tion. Mandatory tender offers under Article 106 TUF must be unconditional: the only conditions generally accepted by Consob are those relating to regulatory approvals required by law.
In practice, the most common condition in Italian pub- lic takeovers is the minimum acceptance condition, whereby the offer becomes effective only if a certain percentage of shares (for example, 50%, 66% or 90%) is tendered by the end of the offer period. Other fairly common conditions include obtaining the required regulatory approvals, such as antitrust clearance from the Antitrust Authority or “Golden Power” authorisa - tion from the Presidency of the Council of Ministers (see 7.3 Restrictions on Foreign Investments for more on the Golden Power regime). 6.6 Deal Documentation It is customary to have a deal agreement with the tar- get and/or key shareholders addressing co-operation, non-solicitation/exclusivity (pre-announcement), and recommendation undertakings. Public targets give limited representations in the offer context; disclosure is primarily via the offer document cleared by Consob, and by the target board’s response to shareholders. 6.7 Minimum Acceptance Conditions In voluntary tender offers, bidders commonly include a minimum acceptance condition, which makes the offer effective only if a certain percentage of shares is tendered by the end of the offer period. This is allowed under Article 40 (1) of Consob Regulation No 11971/1999, provided that the condition is objective and not dependent on the bidder’s discretion. Typical thresholds are: more than 50% (simple control), two thirds (qualified control), 90% (threshold for manda- tory sell-out under Article 108 TUF), and 95% (thresh- old for squeeze-out under Article 111 TUF). In recent Italian takeovers – particularly in the technology sec- tor – thresholds of 90% or 95% have been the most common. 6.8 Squeeze-Out Mechanisms Under Article 111 TUF, following a full takeover bid, a bidder that holds at least 95% of the voting capital of an Italian listed company is entitled to compulsorily acquire all remaining shares (squeeze-out right). The right must be expressly stated in the offer document and may be exercised within three months from the end of the acceptance period. The purchase price is determined in accordance with Article 108 (3)–(5) TUF, and the transfer becomes effective upon the deposit
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