CAYMAN ISLANDS Law and Practice Contributed by: Shari Seymour, Kerry Ann Phillips and Michael Lockwood, Maples Group
6.4 Common Conditions for a Takeover Offer Cayman Islands laws and regulations do not prescribe any conditions for a takeover offer, nor impose any restrictions on offer conditions. Any conditions would be a commercial matter to be agreed among the parties. Typical condi - tions in a tender offer relate to material matters such as regulatory and shareholder approval or consents. Where a target company is CSX listed, the Code provides that an offer must not be sub - ject to conditions depending solely on subjec - tive judgements by the directors of the offeror, or the fulfilment of which is in their hands, save with the consent of the CSX Counsel Executive. 6.5 Minimum Acceptance Conditions Tender offers are conditional on a bidder acquir - ing a sufficient number of target shares to avail themselves of the procedures set out in 2.1 Acquiring a Company or 6.10 Squeeze-Out Mechanisms . 6.6 Requirement to Obtain Financing A business combination can be conditional on the bidder obtaining financing. 6.7 Types of Deal Security Measures Bidders may negotiate with the target for the provision of break fees, non-solicitation under - takings, exclusivity periods and match rights on competing bids, among other deal security measures. When agreeing to any such protec - tion measures, the board of directors of a Cay - man Islands target company should take into account their fiduciary and other duties owed to the company, and be comfortable that such arrangements are permissible under the com - pany’s articles of association and are in the best interests of the company.
obliged to make mandatory offers to holders of any class of equity capital and to holders of any class of voting non-equity capital of which such person or persons acting in concert with them hold shares: • any person who acquires shares that (taken together with shares held by such person or held or acquired by persons acting in concert with such person) carry 30% or more of the voting rights of a company; or • any person who, together with persons act - ing in concert with such person, holds not less than 30% but not more than 50% of the voting rights of a company and such person, or any person acting in concert with such person, acquires in any period of 12 months additional shares carrying more than 1% of the voting right. Offers for different classes of equity capital must be fair and appropriate, having regard to cur - rent circumstances, and the Council Executive of the CSX must be consulted in advance in such cases. 6.3 Consideration Cash and shares (or equivalent equity securi - ties) are equally common forms of consideration for M&A transactions involving Cayman Islands companies. There are no specific common tools used in Cayman Islands M&A transactions to bridge value gaps between the parties in a deal envi - ronment or industry with high valuation uncer - tainty. The deal documents are usually governed by onshore law (eg, New York or Delaware law) and, as such, the tools used for onshore M&A transactions would typically apply.
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