GERMANY Law and Practice Contributed by: Marc Löbbe, Michaela Balke, Oliver Schröder and Martin Kolbinger, SZA Schilling, Zutt & Anschütz
5. Negotiation Phase 5.1 Requirement to Disclose a Deal With regard to disclosure duties, a distinction must be made between listed and non-listed companies. If the target company (or the bidder/seller) is list - ed, it can be obliged to make ad hoc announce - ments at different stages of an M&A transaction. The European Market Abuse Regulation (MAR) governs the specific requirements of the obliga - tion to make ad hoc announcements, and states that an issuer must inform the public as soon as possible of inside information that directly con - cerns that issuer. It is therefore decisive whether or not the infor - mation in question is “inside information” . For this to be the case, the information must meet the following conditions: • it must relate, directly or indirectly, to one or more issuers or to one or more financial instruments; • it must be of a precise nature; • it may not have been made public yet; and • if it were made public, it would be likely to have a significant effect on the price of those financial instruments or on the price of related derivative financial instruments. Protracted Processes In a protracted process that occurs in stages (eg, in the case of an M&A transaction), it is recognised that the final steps (signing/closing) may trigger the obligation to make an ad hoc announcement, but also that this may already be the case for significant intermediate steps. The MAR allows for exceptions, however.
4.3 Hurdles to Stakebuilding See 4.1 Principal Stakebuilding Strategies and 4.2 Material Shareholding Disclosure Thresh- old . 4.4 Dealings in Derivatives Dealings in derivatives are permissible but can lead to notification obligations (see 4.2 Material Shareholding Disclosure Threshold ). Generally, dealings in derivatives are not a feasible way to avoid or circumvent disclosure obligations. 4.5 Filing/Reporting Obligations See 4.1 Principal Stakebuilding Strategies and 4.2 Material Shareholding Disclosure Thresh- old . 4.6 Transparency If an investor issues a public takeover offer, the offer document has to state the objectives the bidder is pursuing relating to the target. There - fore, such information is disclosed to the public. Following the acquisition of 10% or more of the voting rights in a company listed on an organised market, investors are required to inform the tar - get company of their intentions and their source of funding. The law specifies in detail the infor - mation to be disclosed in such a scenario, which includes whether the investment serves strategic goals or is a mere capital investment, whether the bidder intends to increase the investment and whether there are intentions to influence the management or substantially change the capital structure.
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