ITALY Law and Practice Contributed by: Roberto Bonsignore, Paolo Rainelli, Gerolamo da Passano and Nicole B. Puppieni, Cleary Gottlieb Steen & Hamilton LLP
6.2 Mandatory Offer Threshold A mandatory tender offer (MTO) is triggered by the acquisition of voting shares or voting rights in an Italian listed company that, when com - bined with the existing holdings of the acquiring person (and any persons acting in concert with them), surpasses the following thresholds based on the total number of voting shares or voting rights in the listed company: • 25% if the company is considered large ( i.e. it has a market capitalisation of at least EUR1 billion) and no other shareholder holds a higher stake; • 30% if no other shareholder possesses more than 50%; or • for shareholders already holding between 30% and 50%, any increase in their holding exceeding 5% over a rolling 12-month period. However, the MTO will not be triggered if these thresholds are exceeded due to a voluntary take - over bid for all the voting shares of the target company or in other exceptional circumstanc - es (eg, temporary threshold crossing, mergers approved by independent minorities, intragroup transactions, or recapitalisation of distressed companies). Cash tender offers are more prevalent than exchange offers in Italy due to several factors, as follows. • Exchange offers are legally more complex as they often involve a capital increase in kind by the bidder, necessitating approval by the bidder’s shareholders. • If the shares offered in the exchange offer are not listed on an EU regulated market, certain obligations arise, including: 6.3 Consideration Cash Versus Shares
As acquisitions are typically negotiated solely with the main shareholders of the target com - pany, definitive agreements between the bidder and the target company governing the bid are rare. However, the scenario may vary in negoti - ated transactions where the target company is directly involved as a party, such as in a merger. 6. Structuring 6.1 Length of Process for Acquisition/ Sale The duration of the acquisition or sale process for an Italian private or listed company varies depending on several factors, such as: • the length of negotiations with the selling/ major shareholder(s) of the target; • the time required to seek and obtain the regu - latory approvals necessary to complete the transaction, such as merger control, foreign subsidies regulation (FSR), foreign direct investment (FDI) or sector-specific regulatory approvals; and • in the case of a public M&A deal involving a tender offer: (a) the time required to carry out the ten - der offer process, from the initial official announcement to the final settlement; and (b) the transaction structure chosen. Typically, a two-step transaction involving a pri - vate acquisition of control followed by a manda - tory tender offer will take longer than a one-step transaction consisting of a voluntary tender offer only. On average, a private M&A deal or a one-step public M&A deal could take between three and six months, whereas a two-step public M&A deal could take between seven and nine months.
953 CHAMBERS.COM
Powered by FlippingBook