COLOMBIA Law and Practice Contributed by: Jaime Trujillo, Andres Crump and Natalia Ponce de León, Baker McKenzie
holders. In these agreements the prospective buyer’s obligation is to launch a public tender offer on the pre-agreed terms and conditions, and the other party’s (the selling shareholder’s) obligation is to accept the public tender offer, if it meets the pre-agreed terms. However, because applicable regulations expressly prohibit agreements that hinder the right of shareholders to accept competing offers, these agreements can include break-up fees that would apply if the sellers accepted a better offer. The bidder must file a formal request before the SFC with a draft of the notice of its intention to make the public tender offer, which must include: • the name and identification of the bidder; • the minimum and maximum number of shares that the bidder will accept (with at least a 20% margin between the two figures); • information regarding the shares that the bid - der already has in the target company; • the price at which the shares will be paid; • the date by which the offer must be accepted; • settlement terms, form of payment and guar - antees; • the name of the exchange broker to be used in the operation; and • information on any pre-agreed terms. 7. Disclosure 7.1 Making a Bid Public Additionally, when the consideration consists of securities issued by an entity other than the bid - der, the offering booklet must include, inter alia, the following information: • the financial information of the issuing com - pany of the securities offered as payment,
which was provided to the stock exchanges where they were listed during the previous 12 months; • the nature and characteristics of the securi - ties offered as payment, and the amount and proportions in which they will be delivered; • the rights and obligations embodied in the securities, with express reference to the con - ditions and the date from which they entitle the holders to participate in profits, as well as express mention of whether or not they enjoy voting rights; • a brief description of the tax, foreign exchange and foreign investment regimes applicable to the securities offered as pay - ment; and • information on the methodology used to value the securities offered as payment. The bidder must also prepare and submit an offering memorandum for the SFC’s approval with the following information (in addition to the information contained in the public tender offer notice): • the name and principal place of business of the target company; • the name, principal place of business and main corporate activity of the bidder; • a list of individuals or companies that are subordinated to the bidder or are part of a business group with it, indicating the corre - sponding corporate structure; • information on shares that the bidder already has in the target company and any prear - ranged transactions or other agreements between the bidder and the management of the target company or other shareholders; • a brief description of the tax, foreign exchange and foreign investment regimes applicable to the securities offered as pay - ment (if applicable);
495 CHAMBERS.COM
Powered by FlippingBook