Mergers & Acquisitions 2021 A practical cross-border insight into mergers and acquisitions 15th Edition Featuring contributions from: Aabø-Evensen & Co Advokatfirma Dittmar & Indrenius Oppenheim Law Firm Advokatsko druzhestvo Stoyanov & Tsekova in E&G Economides LLC Philip Lee cooperation with Schoenherr GDA Advogados Roca Junyent SLP APM & Co. GSK Stockmann Rokas ASP Advogados Hogan Lovells Schoenherr Atanaskovic Hartnell Houthoff Shardul Amarchand Mangaldas & Co Bär & Karrer Ltd Skadden, Arps, Slate, Meagher & Flom LLP Lee and Li, Attorneys-At-Law BBA//Fjeldco URBAN STEINECKER GAŠPEREC BOŠANSKÝ LEGIS and Partners Ltd Bech-Bruun Vieira de Almeida Lexel Juridique & Fiscal Blake, Cassels & Graydon LLP Wachtell, Lipton, Rosen & Katz Maples Group Bowman Gilfillan Inc. Walalangi & Partners (in association with Nishimura MJM Limited & Asahi) Cektir Law Firm Moravčević Vojnović and Partners in Walkers de Bedin & Lee LLP cooperation with Schoenherr WBW Weremczuk Bobeł & Partners Attorneys at Law DealHQ Partners Nishimura & Asahi Wolf Theiss DF Advocates NUNZIANTE MAGRONE Table of Contents Expert Chapters Global M&A Trends in 2020 1 Scott C. Hopkins, Adam Howard & Craig Kelly, Skadden, Arps, Slate, Meagher & Flom LLP M&A Lessons from the COVID Crisis 4 Adam O. Emmerich & Trevor S. Norwitz, Wachtell, Lipton, Rosen & Katz Q&A Chapters Angola Indonesia 9 Vieira de Almeida / ASP Advogados: Susana Almeida 143 Walalangi & Partners (in association with Nishimura Brandão & Hugo Sipitali & Asahi): Miriam Andreta & Siti Kemala Nuraida Australia Ireland 16 Atanaskovic Hartnell: Lawson Jepps & Jia-Lee Lim 149 Philip Lee: John Given & Andreas McConnell Austria Israel 24 Schoenherr: Christian Herbst & Sascha Hödl 157 APM & Co.: Ian Rostowsky, Stephen Barak Rozen & Elinor Polak Bermuda 35 MJM Limited: Jeremy Leese & Brian Holdipp Italy 165 NUNZIANTE MAGRONE: Fiorella Alvino & Fabio British Virgin Islands Liguori 42 Walkers: Matthew Cowman & Patrick Ormond Japan Bulgaria 172 49 Nishimura & Asahi: Tomohiro Takagi & Keiichiro Schoenherr (in cooperation with Advokatsko Yamanaka druzhestvo Stoyanov & Tsekova): Ilko Stoyanov & Katerina Kaloyanova Luxembourg 181 GSK Stockmann: Marcus Peter & Kate Yu Rao Canada 58 Blake, Cassels & Graydon LLP: Markus Viirland & Madagascar Richard Turner 187 Lexel Juridique & Fiscal: Tafita Ratsimba Cayman Islands 67 Malta Maples Group: Nick Evans, Suzanne Correy & Louise 192 DF Advocates: Dr. Maria Paloma Deguara & Celia Mifsud Cowley Mauritius Cyprus 200 74 LEGIS and Partners Ltd: Bertrand Betsy, Caroline E&G Economides LLC: Virginia Adamidou & George Samy & Zahraa Auchoybur Economides Montenegro Czech Republic 209 81 Moravčević Vojnović and Partners in cooperation Wolf Theiss: Tereza Naučová & Michal Matouš with Schoenherr: Slaven Moravčević & Miloš Laković Denmark 89 Mozambique Bech-Bruun: Steen Jensen & David Moalem 217 Vieira de Almeida / GDA Advogados: Guilherme Daniel & Susana Almeida Brandão Finland 96 Dittmar & Indrenius: Anders Carlberg & Jan Ollila Netherlands 224 Houthoff: Alexander J. Kaarls & Willem J.T. Greece Liedenbaum 104 Rokas: Viktoria Chatzara & Kosmas Karanikolas Nigeria Hong Kong 233 112 DealHQ Partners: Orinari Jeremy Horsfall & Adefere de Bedin & Lee LLP: Claudio de Bedin & Helen Morris Adeyemo Hungary 120 Norway Oppenheim Law Firm: József Bulcsú Fenyvesi & 240 Aabø-Evensen & Co Advokatfirma: Ole Kristian Mihály Barcza Aabø-Evensen Iceland 127 Poland BBA//Fjeldco: Stefán Reykjalín 255 WBW Weremczuk Bobeł & Partners Attorneys at Law: Łukasz Bobeł India 134 Shardul Amarchand Mangaldas & Co: Raghubir Portugal Menon, Sakshi Mehra & Dipayan Bhattacherjee 262 Vieira de Almeida: Jorge Bleck & Domingos Freire de Andrade Table of Contents Serbia Switzerland 270 Moravčević Vojnović and Partners in cooperation 310 Bär & Karrer Ltd: Dr. Mariel Hoch with Schoenherr: Matija Vojnović & Vojimir Kurtić Taiwan Slovakia 318 Lee and Li, Attorneys-At-Law: James Huang & Eddie 278 URBAN STEINECKER GAŠPEREC BOŠANSKÝ: Hsiung Marián Bošanský & Juraj Steinecker Turkey 325 Slovenia Cektir Law Firm: Berk Çektir & Uğur Karacabey 284 Schoenherr: Vid Kobe & Bojan Brežan United Kingdom South Africa 334 Hogan Lovells: Ben Higson, Sarah Shaw, John 295 Bowman Gilfillan Inc.: Ezra Davids & Ryan Kitcat Connell & John Holme USA Spain 342 303 Roca Junyent SLP: Natalia Martí Picó & Xavier Costa Skadden, Arps, Slate, Meagher & Flom LLP: Ann Beth Stebbins & Thad Hartmann Chapter 10 67 Cayman Islands IslandsCayman Nick Evans Suzanne Correy Maples Group Louise Cowley 1 Relevant Authorities and Legislation listed on the CSX, there are no different rules for different types of company. 1.1 What regulates M&A? 1.3 Are there special rules for foreign buyers? The primary sources of regulation of M&A in the Cayman Islands are the Companies Act (2020 Revision) (the “Companies Act”) There are no foreign investment restrictions or exchange control and common law. legislation in the Cayman Islands. However, any company with Part XVI of the Companies Act facilitates mergers and consol- an established physical presence in the Cayman Islands must be idations between one or more companies, provided that at least structured so as to comply with local licensing laws, including one constituent company is incorporated under the Companies with respect to ownership. Any company engaging in business Act. The Limited Liability Companies Act (2020 Revision) (the locally requires to be licensed under the Trade and Business “LLC Act”) also provides for a similar framework for Cayman Licensing Act (2019 Revision) and the applicant must either be Islands limited liability companies. beneficially owned and controlled at least 60% by persons of In addition: Caymanian Status, or hold a licence under the Local Companies ■ mergers, amalgamations and reconstructions by way of a (Control) Act (2019 Revision). However, foreign investment, if scheme of arrangement approved by the requisite majorities considered beneficial to the Cayman Islands’ economy, is gener- of shareholders and creditors and by an order of the Cayman ally encouraged. Islands court under section 86 or 87 of the Companies Act are still available for complex mergers (and are mirrored in 1.4 Are there any special sector-related rules? the LLC Act); and ■ section 88 of the Companies Act provides a limited There are change-of-control rules applicable to entities regu- minority squeeze-out procedure (and, again, is mirrored in lated by the Cayman Islands Monetary Authority under the the LLC Act). Banks and Trust Companies Act (2020 Revision), the Insurance The Cayman Islands does not have a prescriptive set of legal Act, 2010 or (with respect to licensed mutual fund administra- principles specifically relevant to “going private” and other tors) the Mutual Funds Act (2020 Revision). In addition, owner- acquisition transactions (unlike other jurisdictions such as, for ship and control restrictions apply to certain entities regulated example, Delaware). Rather, broad common law and fiduciary by the Information and Communications Technology Act (2019 principles will apply. Revision). While there are no specific statutes or government regulation concerning the conduct of M&A transactions, where the target company’s securities are listed on the Cayman Islands Stock 1.5 What are the principal sources of liability? Exchange (“CSX”), the CSX Code on Takeovers and Mergers and Rules Governing Substantial Acquisitions of Shares (the Pursuant to common law rules, the directors of Cayman Islands “Code”), which exists principally to ensure fair and equal treat- companies owe fiduciary duties (generally described as being ment of all shareholders, may apply. those of loyalty, honesty and good faith) to the company. While it is common for directors of Cayman Islands companies to be 1.2 Are there different rules for different types of indemnified for certain breaches of this duty, as a matter of company? public policy, it is not possible for directors to be indemnified for conduct amounting to wilful default, wilful neglect, actual Except to the extent described above with respect to companies fraud or dishonesty. Mergers & Acquisitions 2021 68 Cayman Islands To the extent that consent to a merger or acquisition is of no less than 90% in value of the shares to which the offer procured via an information memorandum or proxy state- relates, excluding shares held or contracted to be acquired prior ment, civil liability in tort may arise for negligent misstatement to the date of the offer. Shares held by the bidder or its affiliates or fraudulent misrepresentation. In addition, the Contracts are typically not counted for purposes of the 90% requirement. Act (1996 Revision) gives certain statutory rights to damages Dissenters have limited rights to object to the acquisition, and in in respect of negligent misstatements. There are certain crim- the case of a tender offer that is not on an exclusively cash basis, inal sanctions under the Penal Code (2019 Revision) for decep- dissenters have no right to compel a cash alternative. tive actions, including for any officer of a company (or person Contractual asset acquisitions, where the target ceases doing purporting to act as such) with intent to deceive members or business and is liquidated after the consummation of the sale, creditors of the company about its affairs, who publishes or are becoming less popular given the flexibility and ease of use of concurs in publishing a written statement or account that, to the statutory merger regime, but remain a useful option. their knowledge,