ANDORRA Law and Practice Contributed by: Marc Ambrós and David Cuesta, Cases & Lacambra
5.5 Definitive Agreements It is permissible for tender offer terms and condi - tions to be documented in a definitive agreement. The tender offer usually contains the main terms and conditions of the transaction, and therefore it is documented in the definitive agreement, along with other terms and conditions that may arise from the due diligence process. 6. Structuring 6.1 Length of Process for Acquisition/ Sale The duration of the process for acquiring/selling a business in Andorra depends on several fac - tors, such as the scope of the due diligence pro - cess or the need to obtain financing. The dura - tion of the process also depends on the timing of the authorisation by the government of Andorra for foreign investments and/or the AFA, as the case may be. Based on the above, the process for acquiring/ selling a business in Andorra generally takes from four to 12 months. 6.2 Mandatory Offer Threshold Andorra does not have a mandatory offer thresh - old. 6.3 Consideration Cash is more commonly used as consideration in Andorra. In deals with high-valuation uncer - tainty, it is usual to fix an initial price upon sign - ing and to adjust such fixed price upon closing using the completion accounts mechanism. 6.4 Common Conditions for a Takeover Offer As Andorran companies are all private, the offer conditions are usually negotiated directly
sion. Therefore, when negotiations commence, this must be disclosed to the financial authority. Notwithstanding the initial disclosure of the acquisition of a qualified stake in a financial entity, it is also subject to prior authorisation by the AFA. On the other hand, in mergers, the resolutions adopted by the shareholders’ meetings of the companies involved need to be published in two newspapers so that creditors of the companies involved can oppose the merger, and the reso - lutions are only effective after one month has elapsed from the date of publication of the reso - lutions. The due diligence process is not specifically regulated in Andorra. However, it is common to conduct a due diligence process prior to the acquisition of an Andorran target company. The scope of due diligence usually covers all the legal aspects applicable to the target company such as corporate, tax, intellectual property, liti - gation, real estate, financing, permits, regulatory compliance, and personal data protection. The scope of due diligence may differ depending on the business, sector or assets owned by the tar - get company. 5.4 Standstills or Exclusivity Standstills are not usually demanded in Andorra. On the other hand, exclusivity is usually required, since most Andorran companies are family con - trolled. 5.2 Market Practice on Timing This is not applicable in Andorra. 5.3 Scope of Due Diligence
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