AUSTRIA Law and Practice Contributed by: Clemens Hasenauer and Albert Birkner, CERHA HEMPEL
acquiring shares issued by a stock corporation with its corporate seat in Austria and listed on a regulated market on the Vienna Stock Exchange. Furthermore, the Takeover Act also applies (par - tially) where only the requirement of a corporate seat or the listing is fulfilled in Austria and the other requirement is fulfilled in another jurisdic - tion. The Takeover Act distinguishes between three types of offers: • mandatory offers; • voluntary offers; and • voluntary offers aimed at obtaining control. Furthermore, the Takeover Act also foresees an offer to delist securities from the Official Market of the Vienna Stock Exchange. Such an offer is subject to the provisions governing mandatory offers, whereby certain modifications apply. Mandatory Offers Generally, the obligation to launch a mandatory offer is triggered if a bidder (be it an individual or parties acting in concert) seeks to acquire a con - trolling shareholding, which is defined by statute as a direct or indirect controlling interest of more than 30% of the voting stock. A shareholding that gives the holder between 26% and 30% of the voting rights must, however, be notified to the Takeover Commission. An exception to this rule applies in certain cases where an obligation to launch an offer would exist in principle due to the acquisition of a controlling interest. In the following cases, the Takeover Commission only needs to be notified: • for a passive acquisition of a controlling inter - est (ie, where a controlling interest is obtained without any action having been taken by the acquirer, provided that the acquirer could not
reasonably have expected to obtain control at the time at which ownership of the respective shares was acquired); • for an acquisition of a controlling interest which does not enable the acquitting party to exert a decisive influence over the target; or • in other defined exceptional situations (such as certain “creeping in” situations). “Creeping-In” The Takeover Act also addresses the issue of “creeping-in” acquisitions by shareholders. If a shareholder who holds a controlling interest – though not necessarily a majority of the voting rights – acquires at least an additional 3% of the voting rights (on a netted basis) within a single calendar year, such shareholder must notify the Takeover Commission. In such cases, a man - datory offer must be made, although in certain defined situations, simply notifying the Takeover Commission may suffice. 6.3 Consideration Based on experience, cash is the most common form of consideration, whereas offering shares is rather rare, as are combinations of the two. However, sellers occasionally explore alterna - tive ways, such as the assumption of debt by a buyer, sometimes in combination with a cash payment. In deal environments or industries with high valuation uncertainty, closing accounts are commonly used, and earn-out models are fre - quently discussed to bridge value gaps. Regarding takeover transactions, mandatory offers always require cash consideration but may have a paper alternative in addition. The same applies to voluntary takeover offers aimed at obtaining control. Only purely voluntary offers (not aimed at obtaining control) may be in cash or securities.
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