IRELAND Law and Practice Contributed by: Leonora Malone, John Olden, John Darmody and Doreen Mescal, Addleshaw Goddard
5. Negotiation Phase 5.1 Requirement to Disclose a Deal In private M&A, disclosure is typically made when the purchase agreement is signed, particu - larly if merger clearance is required, as details of the transaction will be publicly available after the merger notification. In other cases, a press release is often issued after the transaction is completed. In public M&A, under the Takeover Rules, disclo - sure is required: • immediately after a firm intention to make an offer is communicated to the target’s board; • when a mandatory offer obligation arises; • if there is rumour or speculation, or unusual share price movement following a bidder’s approach; • if such rumour or speculation occurs before a bidder approaches and it is linked to the bid - der’s actions or intentions; • when discussions extend beyond a limited group; or • when negotiations are terminated or the bid - der decides not to proceed. 5.2 Market Practice on Timing In public M&A, market practice generally aligns with the Takeover Rules on timing of disclo - sure. Strict confidentiality must be maintained before a bidder’s intention to make an offer is announced. Prior to this, the initial approach should only be disclosed on a need-to-know basis, ensuring that recipients understand the confidentiality requirements. 5.3 Scope of Due Diligence In private M&A, due diligence typically includes commercial, financial and tax, and legal aspects, with the depth depending on the buyer’s require -
ments. In competitive auctions, sellers may con - duct limited vendor due diligence, which bidders then supplement with their own investigations. Warranty and indemnity insurance providers often require robust due diligence as a condi - tion for coverage. By contrast, in public M&A, due diligence is pri - marily based on publicly available information, with deeper investigations generally occurring after an offer is made. 5.4 Standstills or Exclusivity Exclusivity agreements are customary in Irish M&A. In private M&A, an acquirer will typically seek exclusivity once it is ready to make an indicative offer for the target. Binding exclusiv - ity provisions requiring the target and/or the tar - get’s shareholders to negotiate solely with the acquirer and not negotiate or solicit offers from any other prospective buyers for a defined peri - od of time will often be set out in the term sheet or heads of agreement or non-binding offer or similar preliminary agreement. In public M&A, a bidder may also seek exclu - sivity, but any exclusivity agreement entered into with the target is subject to the Takeover Rules and to the fiduciary duties of the target’s directors. A bidder may also seek irrevocable commitments or letters of intent to accept the offer from the target’s directors and sharehold - ers; such irrevocable commitments or letters of intent are subject to disclosure requirements under the Takeover Rules, and care would need to be taken to avoid falling foul of prohibitions in respect of insider trading. Standstill provisions are also usually demand - ed in public M&A. They are typically agreed in contemplation of a takeover bid or scheme of arrangement and allow for confidential discus -
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