In the same context of the last article - Part 6 - of this series, where we explained the most important tips on how to submit successful competing acquisition offer. In this Part we will highlight the conditions of submitting an offer to acquire the target company.…. Let’s start.
How the offer intent declaration should be published?
The acquirer shall deliver the intent of acquisition to the target company in a written form. In the event the acquirer fails to inform the target company of its intent of acquisition, the acquirer shall declare the intent of acquisition in the following cases:
- The presence of rumors about the acquisition.
- Occurrence of price movements and unusual volumes of trading on the securities.
- If the acquirer holds other securities that warrant making a mandatory acquisition offer.
- Doing any act that indicates the intent of acquisition.
Whenever the target company is aware of the intent of acquisition, it should announce the intent of acquisition in the following cases:
- The presence of rumors about the acquisition.
- Occurrence of price movements and unusual volume of trading on the securities.
- Doing any act that indicates the intent of acquisition.
- Receiving a notice from the acquirer of its intent of acquisition.
Any person holding (30%) of the capital of the target company, whenever he is negotiating with the acquirer about the acquisition, and when the target company is not aware of the intent of acquisition, shall announce the intent of acquisition in the following cases:
- The presence of rumors about the acquisition.
- Occurrence of price movements and unusual volume of trading on the securities.
- Doing any act that indicates the intent of acquisition.
What is announcement should include?
The acquirer shall publish the announcement of the intent to offer on the secure market’s website and the announcement shall include the following data and information:
- The terms of the offer.
- The real identity of the acquirer and its key shareholders.
- The details of the securities actually/ potentially held by the acquirer and its associated group during the term of the acquisition.
- Indicate whether the acquirer has received any irrevocable obligations in relation to acceptance of the offer.
- The details of any arrangements with the target company which may have a material impact on the offer.
- A confirmation by the financial consultant of the acquirer that the latter has the required financial resources to execute the offer.
- The intents, future plans and the purpose of the acquisition.
- The arrangements related to the termination fees.
- Any other data or information requested by SCA.
To What extent the acquirer is responsible for the offer?
The acquirer shall be responsible for the accuracy of the data contained in the draft offer and the draft offer documents, as well as the associated consultants who participated in the preparation and approval of any draft shall verify the data contained therein, including the accuracy of the data related to the estimation of the offer price or the swap coefficient.
The acquirer and its board of directors shall be liable for the content of the offer document. Any amendment / correction to the offer document shall be made and disclosed immediately.
The offer document shall contain a declaration that the board of directors of the acquirer, or the persons acting on their behalf, shall be liable for the validity and accuracy of the facts contained in the document and that no material facts have been omitted or ignored.
The consultants of the acquirer shall be liable for the content of the offer document within the limits of negligence of their duties, provided that they perform due diligence in performing such duties.
After clarifying all conditions should be considered while submitting an offer to acquire the target company, how do you get SCA’s approval on an acquisition transaction?...... stay tuned for the answer in the next article
For further assistance or information regarding M&A please find out how our experts at Al Safar & Partners can help. Call +97144221944 or email reception@alsafarpartners.com www.alsafarpartners.com to get started.