ETHIOPIA Law and Practice Contributed by: Getu Shiferaw, Awoke Mitku, Gutema Kajela Ejeta and Debora Belachew, Mehrteab & Getu Advocates LLP
10. Litigation 10.1 Frequency of Litigation Litigation is not common in connection with M&A deals in Ethiopia. 10.2 Stage of Deal Although not common in Ethiopia, litigation may There were no disputes between parties with pending transactions in Ethiopia in early 2020 with publicly available details. 11. Activism 11.1 Shareholder Activism Shareholder activism is not a common practice in Ethiopia. 11.2 Aims of Activists Since shareholder activism is not a common practice in Ethiopia, it is not feasible to discuss whether activists seek to encourage compa - nies to enter into M&A transactions, spin-offs or major divestitures. However, activists who are not shareholders have tried to discourage companies from entering into similar transac - tions, especially those that are not common in Ethiopia. 11.3 Interference With Completion occur at any stage of a transaction. 10.3 “Broken-Deal” Disputes Shareholder activist interference with the com - pletion of announced transactions is not com - mon in Ethiopia.
• given reasonable and equitable opportuni - ties to participate in any benefits accruing to shareholders under the proposal; and • accorded fair and equitable treatment in rela - tion to the proposal. However, in practice, hostile tender offers for public mergers have not been seen, since Ethio - pian capital market practice is yet to be devel - oped. 9.2 Directors’ Use of Defensive Measures Since the power to decide on a merger lies with the shareholders through their extraordinary general meeting, defensive measures by direc - tors do not apply in principle under Ethiopian law. 9.3 Common Defensive Measures As long as a merger is approved by the share - holders of a company, there are no common defensive measures for directors under Ethio - pian law. 9.4 Directors’ Duties Since the power of merger approval is given to the shareholders’ general meeting, and that there are no common defensive measures under Ethiopian law, there are no directors’ duties in relation to enacting defensive measures. 9.5 Directors’ Ability to “Just Say No” As long as the shareholders decide in favour of a merger/ business combination, the directors cannot “just say no” and take action that pre - vents the combination.
677 CHAMBERS.COM
Powered by FlippingBook