EGYPT Law and Practice Contributed by: Mohamed Hashish, Farida Rezk, Omar Aboul-Ella and Mariam Rabie, Soliman, Hashish & Partners
6. Structuring 6.1 Length of Process for Acquisition/ Sale The timing of the process of acquiring or selling a business primarily depends on the mode of its execution and the parties’ agreement, without prejudice to any legally required timeline. In the acquisition of private companies, the process for the transfer of shares usually takes up to five days from the receipt by the broker of the share transfer documents. However, in a public tender offer, the duration of the offer is typically within 30 days, including the period of review and approval of the FRA of the application made by the bidder and the launch of the tender offer by publication on the screens of the EGX. The review process by the ECA and/or FRA (as the case may be) for clearing notifiable eco - nomic concentrations should also be taken into consideration, which may take up to 60 days as of the date of submitting the notification file to the relevant authority. 6.2 Mandatory Offer Threshold Under Egyptian law, with respect to companies subject to oversight by the FRA, a mandatory tender offer obligation is triggered when a per - son, whether directly or through its related par - ties: • acquires one-third or more of the share capi - tal or voting rights of the target company; • holds more than one-third but not more than half of the share capital or voting rights of the target company, and within 12 consecutive months, its ownership exceeds 5% above its existing stake;
• exceeds half of the share capital or the vot - ing rights of the target company at any given time; • holds more than half but not more than two- thirds of the share capital or voting rights of the target company, and within 12 con - secutive months, its ownership exceeds 5% above its existing stake; • holds more than two-thirds but not more than three-quarters of the share capital or voting rights of the target company, and within 12 consecutive months, its ownership exceeds 5% above its existing stake; or • exceeds three-quarters of the share capital or voting rights of the target company at any given time. Exceptions The FRA may exempt the following cases from the obligation to submit a mandatory tender offer, provided that the FRA is notified and does not object within 15 days from the date of noti - fication: • assignment of shares between parents and children; • cases of inheritance, will and gift; • transfer of ownership of securities pledged to Egyptian and foreign banks and financial institutions in settlement of their dues; • if the acquisition is made by one of the financial institutions licensed to guarantee subscription operations in implementation of its obligation to guarantee subscription cover - age; • in the event that all shareholders of the com - pany approve the sale; • cases of transfer of ownership of all shares owned by the union of workers who are shareholders in subsidiaries of state-owned holding companies to restructure these com -
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