Morocco Takeover Guide

Transcription

1 Morocco Takeover Guide Contact José Ignacio García, Hamid Errida and Jaàfar Laidi Garrigues Maroc

2 Contents Page INTRODUCTION 1 TAKEOVER REGULATIONS 1 COMPULSORY TAKEOVERS 2 TAKEOVER INITIATION PROCEDURE 2 COMPETING BIDS 3 INITIATING COMPANY S AND TARGET COMPANY S OBLIGATIONS 3 TAKEOVER SUPERVISORY AUTHORITY 4 TIMETABLE FOR VOLUNTARY TAKEOVER 5 TAX ASPECTS 5 ANTITRUST ASPECTS _1_ takeover guide - morocco

3 INTRODUCTION This guide deals with the main Moroccan rules on takeovers in force as of July 31, 2013, and it is necessarily brief and general in nature. Specific professional advice must be sought before taking any further action in relation to the matters dealt with hereafter. TAKEOVER REGULATIONS Under Moroccan legislation, a takeover is defined as a procedure by which an individual or an entity, known as the initiator, acting alone or in concert, publicly proposes to acquire, exchange or sell all or some of the securities constituting a stake in the authorised capital of, or in the voting rights of, a target company, the securities of which are listed on a stock exchange. There are four takeover categories: takeover bids (in cash); public exchange offers (for listed securities); public withdrawal offers (following a takeover bid or a public exchange offer); and public offerings. A takeover bid consists of offering to buy the stock of the target company from its current shareholders at a price proposed by the initiator which is generally higher than the quoted price of the stock. A public exchange offer consists of acquiring the listed stock of the target company in exchange for other listed securities. A takeover bid and public exchange offer can be combined in a hybrid offer, with part payment in listed securities and the balance in cash. The applicable rules depend on the characterisation ascribed to the offer by its initiator, subject to approval from the supervisory authority Conseil Deontologique des Valeurs Mobiliéres (CDVM) 1.. A public withdrawal offer allows the majority shareholders of the target company to acquire the listed securities of minority shareholders, who should consequently withdraw from the authorised capital of the company. A public offering is made by shareholders wishing to sell their listed stock in the target company. The purpose of a takeover bid, public exchange offer or public withdrawal offer is to acquire the target company with a view to subsequent merger. A public withdrawal offer is also compulsory when the stock of a company is to be delisted. 1 CDVM will change its name to «Autorité Marocaine du Marché des Capitaux» (AMMC) upon publication of the Decrees implementing the new Law governing AMMC _1_ takeover guide - morocco page 1

4 In contrast, a public offering entails a loss of control and a reduction in the principal shareholder s stake, since part of the target company s listed securities are sold on the market. COMPULSORY TAKEOVERS In principle, takeover bids are voluntary, which means that any person wishing to acquire listed securities on the stock exchange can, at its own initiative, launch a takeover bid. However, as soon as a natural or legal person, acting alone or in concert holds, directly or indirectly, 40% of the voting rights of a listed company, he must file a draft takeover bid with the CDVM within three working days following the crossing of the aforementioned threshold. If the draft takeover bid is not filed, the initiator and, as the case may be, anyone acting in concert with them, will forfeit all voting and financial rights that otherwise accrue to him as a shareholder. Such rights are exercisable only after the draft takeover bid has been filed. However, a dispensation from fulfilling the obligation to file the draft takeover bid can be granted when the crossing of the 40% threshold does not affect the control of the target company. This will occur particularly in the case of: a capital reduction at the target company; or a transfer of title to the listed securities between companies belonging to the same group. The same holds true for the compulsory filing of public withdrawal offers, except that the threshold is 95% of the voting rights at the target company. TAKEOVER INITIATION PROCEDURE A draft takeover bid filed by an initiator with the CDVM must refer to certain information, such as: the objectives of the initiator; the number of listed securities subject to the draft bid; and the price proposed by the initiator. The draft bid must also contain proposals based on which the initiator has to guarantee the terms and the actual implementation of the bid. If the draft bid is cleared by the CDVM, the proposals become irrevocable commitments of the initiator. If, in the draft bid, it is envisaged that stock will be issued, the initiator has to obtain a preliminary authorisation for the transaction from the shareholders meeting of the issuer. Moreover, the draft bid must also receive preliminary clearance from the relevant supervisory authorities, particularly where the bid is targeted at a credit institution or an insurance company, or when there is a risk that antitrust law will be infringed. The information document prepared by the initiator must also receive preliminary clearance _1_ takeover guide - morocco page 2

5 The CDVM will publish a notice to confirm that a draft bid has been filed and will forward the case file to the Ministry of Finance for it to rule on the admissibility of the bid within two days thereafter. The CDVM will also consider the admissibility of the draft bid within 10 days from publication of the notice. In this connection, it can require the initiator to furnish the appropriate justifications and provide security for the down payment on the listed securities. If the bid is deemed inadmissible, the CDVM must hand down a reasoned decision and notify it to the initiator. This decision may be appealed to the courts of justice. If the bid is deemed admissible, the CDVM will notify the initiator of its decision, publish a notice of admissibility in a legal gazette and direct the stock exchange to allow trading in the target s securities to resume (previously suspended while the draft bid was being scrutinised). Lastly, the stock exchange will pool the relevant buy, sell or exchange orders and communicate the outcome to the CDVM, which will then publish a notice confirming the outcome of the bid in a legal gazette. COMPETING BIDS Takeover bids can be the subject to one or more competing bids or an overbid. A takeover bid is a competing bid when a natural person or legal entity files with the CDVM a bid for the securities of the target company that is the subject of an existing bid, between the date of commencement of the period for consideration of an existing bid, and no later than five stock exchange trading days before the deadline for its acceptance. In contrast, in the case of an overbid, the initiator of the previous bid improves on its terms, either of its own volition or in the wake of a competing bid by changing the price, nature or quantity of the securities, or the payment terms. Competing bids and overbids are subject to the draft bid filing and scrutiny procedure referred to earlier. The initiator of a competing bid or of an overbid must file an information document supplementing the information document initially filed. In the case of a competing bid, the initiator of the existing bid must inform the CDVM of its intentions no later than 10 days before the deadline for acceptance of the aforementioned bid passes. The initiator can maintain or withdraw its bid or make an overbid. The CDVM sets the timetable for competing bids and overbids and will bring the deadline for acceptance of the current bid into line with the date furthest off. INITIATING COMPANY S AND TARGET COMPANY S OBLIGATIONS Launching a takeover bid entails obligations for the various parties to the transaction, namely, the target company, the initiator, and, as the case may be, anyone with whom he is acting in concert _1_ takeover guide - morocco page 3

6 Common obligations The parties must take great care with their statements relating to the bid. They must limit information disclosed to the public to the terms and matters contained in the information documents filed, in order to avoid any confusion. Moreover, all information on the duration of the bid launched for the target company must be notified to the CDVM before publication or dissemination. The target company concerned, the initiator, any legal entity or natural person holding a direct or indirect stake of at least 5% in the target company s capital or voting rights, and those acting in concert with any of them, must declare to the CDVM after each day s trading on the stock exchange, the securities acquired or sold in relation to the bid and, in general, all public deals that involve a transfer of title to the securities. In case of a hybrid bid, the parties cannot operate on the securities market of the company concerned, or on the market for the securities issued by the company whose securities are offered in exchange. Particular obligations of the target company The target company is not permitted to increase its own share or treasury stock portfolio. The target company and anyone acting in concert with it cannot be involved directly or indirectly in the company concerned. However, if the takeover bid is paid for fully in cash, the target company can continue implementing a stock repurchase program, since this is envisaged in the resolution by the shareholders meeting approving this program. The competent bodies of the target company must inform the CDVM beforehand of every proposed decision to be made by them. Defensive measures in respect of a takeover bid or competing bid include the following: issuing securities en masse; transferring assets; concluding contracts falling outside the ordinary course of the target company s business. TAKEOVER SUPERVISORY AUTHORITY The initiators of a takeover bid, the target company, and, as the case may be, anyone acting in concert with any of them, are subject to supervision by the CDVM, whose brief is to ensure the orderly conduct of bids in the best interests of investors and the market. To that end, the CDVM may require the parties mentioned above to produce all necessary documents and information, and make inquiries with investors. The CDVM may also impose fines in the circumstances set forth in the takeover legislation, subject to a limit of 200,000 Moroccan dirhams. Lastly, a breach of the takeover rules constitutes an offence, and leaves the principals of such offence open to criminal penalties _1_ takeover guide - morocco page 4

7 TIMETABLE FOR VOLUNTARY TAKEOVER We set forth below a tentative calendar for a voluntary takeover, D being the date of publication of the bid in a legal gazette. Days are calendar days. D- 30 Deposit of the draft bid with CDVM D- 28 Admission of the bid by Ministry of Finance D- 20 Examination by CDVM of the draft bid D- 5 Admission of the bid by CDVM D Publication of the bid in a legal gazette TAX ASPECTS Prior to announcing a bid or offer, the initiator must consider the tax impact it may have on the target company and its shareholders, as well as on the tax position of the initiator. ANTITRUST ASPECTS The draft bid must receive preliminary clearance from the relevant supervisory authorities when there is a risk of infringement of antitrust law. Under Moroccan antitrust legislation, any operations of economical integration that are bound to create a dominant position are submitted to the Conseil de la Concurrence by the Prime Minister. Operations are not subject to this procedure if the companies involved have (together) made more than 40% of the total sales and acquisitions made of the internal market of goods of the same kind, in the previous business year. Economical integrations are defined as any actions implying the transfer of property or possession of goods, rights and obligations of a company that permit another company or a group of companies to acquire a determinant influence thereon. Any operations of this type must be notified to the Prime Minister. A two-month silence from the administration is considered as a tacit acceptance. This term is raised to six months if the Prime Minister submits the case to the Conseil de la Concurrence. The companies concerned cannot start the integration project during this term _1_ takeover guide - morocco page 5