Influenced by the need to improve the legal framework of the takeover process as well as to remove certain obstacles identified while enforcing the law in practice, the Croatian Parliament adopted the amendments to the Act on Takeover of Joint Stock Companies (the Takeover Act), which will become applicable as of 15 December 2013.
The most important changes in the legislation are as follows:
- only joint stock companies, the shares of which are listed on a regulated market (in Croatia or in another EU Member State) can be subjects to a takeover offer;
- introduction of a single threshold of 25% (avoiding the previous mechanism to publish takeover offers multiple times);
- the publication of the takeover offer is obligatory to take place only in the Official Gazette and through the market operator of the regulated market;
- clearer definition of the relationship between investment and pension funds and their management companies with respect to joint action in a takeover offer;
- voting rights will not be assigned (and will therefore not count for takeover purposes) to shares acquired exclusively for the sole purpose of executing clearing and settlement within the usual time frame for that on the relevant market;
- shares held by custodians will not be seen as owned by theme, provided that they can exercise the voting rights attached to such shares only on the basis of the strict shareholder instructions received in writing or via electronic means;
- voting rights will not be assigned to shares kept as positions in a trading book of a credit institution or an investment firm and shares acquired or disposed of by market makers;
- the exemptions from the obligation to publish a takeover offer have been expanded and now include the cases of acquiring shares of a target company in the process of financial recovery;
- introduction of an analysis of the fair value of the shares of the target company, audited by a certified auditor, for non-liquid shares to determine the final bid price in a takeover offer
Impact on investors: In effect from 15 December 2013, the amendments in the Croatian Takeover Act bring the local investor environment in line with established EU standards.