DENMARK Law and Practice Contributed by: Simon Milthers, Thomas Bøgedal Kristiansen, Mikkel Friis Rossa and Emil Steenberg, Bech-Bruun
• minimum acceptance condition (typically set at 90% to enable subsequent squeeze-out); • regulatory approvals; • no material adverse change; • no material disposals or acquisitions; • no changes to capital structure and articles of association; • no changes to management employment con- tracts; and • no adverse legislative changes or court rulings. A takeover offer cannot be made conditional on financing. A buyer must have certainty of funds when launching a takeover offer (see 6.9 Requirement to Have Certain Funds/Financing to Launch a Takeover Offer ). Conditions are not permitted in mandatory offers. 6.6 Deal Documentation It is customary to enter into a transaction agreement in connection with a takeover offer or a business com- bination/merger. In addition to recommending the offer, the target com- pany may generally undertake to: • reasonably assist the offeror in soliciting accept- ances of the takeover offer; • facilitate the publication and distribution of the offer document and other announcements from the offeror in connection with the takeover offer (in addition to the announcements that the target company is obligated to assist with publishing pursuant to the Danish Takeover Order); • not act in a manner that would render any offer condition impossible to satisfy; • assist with necessary steps to prepare for a refi- nancing of the target company post-completion; • facilitate delisting (subject to the offeror acquiring sufficient shareholdings); • not dispose of treasury shares (except for settle- ment of share-based incentive programmes which may be an undertaking by itself); • assist the buyer in obtaining merger clearance and other regulatory approvals; and
• other undertakings of a more administrative nature to assist with a smooth completion/takeover (if the takeover offer is successful). A target company typically represents to the buyer that it is not in possession of undisclosed inside infor- mation and that it is in compliance with its disclosure obligations. Otherwise, the target companies typically do not provide representations or warranties. 6.7 Minimum Acceptance Conditions The minimum acceptance condition is typically set at 90%, as this provides the offeror with the opportunity to initiate a squeeze-out of the remaining sharehold- ers and pursue a fast-track delisting from Nasdaq Copenhagen. Depending on the specific deal, an offeror may choose to settle for a lower acceptance rate (eg, two thirds of voting rights, which enables the offeror to amend the company’s articles of association, whereas 50% enables the offeror to control the election of the board of directors). 6.8 Squeeze-Out Mechanisms A statutory squeeze-out can be initiated by a majority shareholder holding more than 90% of the shares and voting rights in a company. The majority shareholder must provide the minority shareholder(s) with a four- week notice/disposal period during which the minor- ity shareholder(s) can voluntarily accept an offer to dispose of shares (or sell them on the market). Upon expiry of the four-week notice/disposal period, the voluntarily transferred shares are settled, followed by redemption of the remaining shares. The redemption price in the squeeze-out is (and should be) the same price as in the preceding takeover offer. Minority shareholders are entitled to demand an independent appraisal of the redemption price. The conclusion of the appraiser may be challenged by either party through legal proceedings. The minority shareholder(s) demanding an appraisal will, as a start- ing point, be liable for the appraisal costs. However, the court may decide that costs should be held by the majority shareholder if it is determined that the redemption price should have been higher.
87 CHAMBERS.COM
Powered by FlippingBook