BELGIUM Law and Practice Contributed by: Michel Bonne, Hannelore Matthys and Virginie Lescot, Van Bael & Bellis
• amendments to the target company’s articles of association. In any case, the bid should normally allow the offeror to achieve the intended result. In prac - tice, the FSMA is reluctant to approve any spe - cific conditions if they are likely to limit (or even undermine) the success of the bid. Furthermore, a bidder may withdraw its volun- tary offer if the European Commission and/or of the relevant national competition authority decide that the takeover would constitute a con - centration which is incompatible with applicable competition law. 6.5 Minimum Acceptance Conditions A voluntary tender offer can be subject to condi - tions (see 6.4 Common Conditions for a Takeo- ver Offer ). One of the most common conditions included by the bidder in its offer is a minimum level of acceptance to ensure that the bidder can control the target company after the bidding process. Thresholds have varied between 50% and 95%. In practice, the FSMA is reluctant to approve any specific conditions, such as mini - mum acceptance, if they are likely to limit the success of the bid. 6.6 Requirement to Obtain Financing In public M&A transactions, a bid cannot be con - ditional on obtaining the necessary financing. The funding must be entirely committed before the bid is announced. The bidder must provide evidence to the FSMA that it has the necessary funding to pay in full the bid price, either in the form of an unconditional and irrevocable bank credit facility concluded with a Belgian credit institution, or in a special bank account opened with a Belgian credit institution. In exchange offers, the bidder must provide evidence to the FSMA that the securities to be offered in
exchange are available to it, or that it has the power to issue or acquire these securities from another person (for example, an affiliate). In private M&A transactions, it is possible to include the obtaining of financing as a condition precedent in the acquisition agreement. While it is not uncommon, the seller will always try to avoid a financing condition precedent. If una - voidable (including, for instance, when the pur - chaser is a private equity player), the seller may sometimes try to negotiate thresholds for obtain - ing the financing (ie, a sufficiently high interest rate and leverage ratio). 6.7 Types of Deal Security Measures In principle, a non-solicitation clause pursuant to which the company undertakes not to solicit any additional offers from other bidders is val - id. However, the validity of (other) deal security measures is debated under Belgian law as it could be argued that they are not in the cor - porate interest of either the bidder or the target company. Therefore, deal protection measures such as match rights, force-the-vote provisions or break-up fees are rare, and it may be delicate to enforce such measures under Belgian law. However, break-up fees are included from time to time in documentation regarding private M&A transactions, in particular in competitive auction processes or in larger transactions, where the parties are already committed, or will commit, to each other between signing and closing. New Regulatory Environment Impacting the Length of Interim Periods The Belgian FDI screening mechanism may impact the length of interim periods. See 2.6 National Security Review .
237 CHAMBERS.COM
Powered by FlippingBook