DENMARK Law and Practice Contributed by: Morten Jensen, Elise Ross-Hansen, Frederik André Bork and Paula Grønlund, Bruun & Hjejle
information related to the transaction must be disclosed in accordance with the MAR if and when the information constitutes inside informa - tion. This will usually occur at some point during the negotiation phase, but the issuing company may be entitled to delay the disclosure until the deal has been signed, provided that the delay conditions set out in the MAR are fulfilled (eg, confidentiality must be ensured). In the case of a takeover, the mere approach by a bidder to the listed company’s board may be regarded as inside information depending on the firmness of the approach (see 7.1 Making a Bid Public ). 5.2 Market Practice on Timing Market practice on the timing of disclosure is in line with the legal requirements set out in the MAR. It is often debated between practitioners as to when a transaction reaches a stage where information regarding the transaction becomes inside information, and whether disclosure of such information by the target can be delayed. 5.3 Scope of Due Diligence In larger private M&A deals, a full scope legal due diligence of the target will be customary. The legal due diligence may be in the form of vendor due diligence, which is topped up by the buyer, or by full buy-side due diligence. As W&I insurance is usually taken out in con - nection with larger private M&A deals, the scope of the due diligence is likely to be affected by the underwriter’s requirements for the level and scope of due diligence. In a public takeover situation, a (non-hostile) bidder will often be granted access to complete light legal due diligence, which focuses on mate - rial issues – eg, business-sensitive matters and/
or litigation. A bidder may also have completed (outside-in) due diligence of all public matters relating to the target. 5.4 Standstills or Exclusivity In connection with a public takeover, a standstill obligation will usually be demanded by the tar - get’s board of directors. A bidder will generally accept a standstill obligation to facilitate discus - sions between the bidder and the target, and to mitigate the risk of insider trading. A bidder is similarly interested in demanding exclusivity. If accepted by the target’s board of directors, it will usually – due to the board’s fidu - ciary duties to act in the company’s best interest – contain a carve-out for competing offers that present a better price. 5.5 Definitive Agreements In connection with a public takeover, it is per - missible for the bidder and the target to docu - ment the agreed terms in a definitive agreement. This is usually seen in larger transactions, but it depends on the circumstances. 6. Structuring 6.1 Length of Process for Acquisition/ Sale The length of the process relating to acquiring or selling a business in a private M&A transaction largely depends on the type of transaction and the size of the target. Most structured processes in Denmark are com - pleted within three to six months’ time, exclud - ing preparatory work. However, as most struc - tured processes require thorough preparation, including gathering information for a data room and completing legal and financial vendor due
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