This Legal Alert seeks to provide information regarding the recent amendments to the “Communiqué on Takeover Bids numbered II-26.1”.
Communiqué regarding the Amendment of the Communiqué on Takeover Bids numbered II-26.1.b. (“Amendment Communiqué”) which amends the Communiqué on Takeover Bids numbered II-26.1 (“Communiqué”) has been published in the Official Gazette on June 5, 2018. The Communiqué regulates the procedures and principles relating to voluntary and mandatory takeover bids in publicly held joint stock companies.
As per Article 5 of the Communiqué, in case the Management Control of a publicly held joint stock company (“Corporation”) gets acquired by way of its shares being fully or partially acquired, the acquiring shareholder shall make a takeover bid to the remaining shareholders.
In the Communiqué, “Management Control” is defined as hereinbelow;
Directly or indirectly, individually or jointly owning:
a) more than 50% of voting rights of the Corporation,
b) privileged shares that would enable election of simple majority of the Corporation’s Board of Directors members;
c) privileged shares that would enable nomination for the simple majority of the Corporation’s Board of Directors members in general assembly meetings.
Besides, Article 18 of the Communiqué presents the circumstances which may be granted as exemptions from this requirement by the Capital Markets Board upon request. With the entry into force of the Amendment Communiqué, the following exceptions have been added. In this respect; if a shareholder gains the Management Control as a result of the following cases, such shareholder will not be obliged to make a mandatory takeover bid to the remaining shareholders.
- Transfer of the title of the shares to the Bank[i], in case of default in loan repayment, which were given as collateral of loans utilized from the Bank in accordance with Article 47[ii], paragraph 4 of the Capital Markets Law No. 6362 (“CML“),
- Transfer of the above-mentioned shares to a Special Purpose Vehicle[iii] where a Bank is also a founder,
- The purchase of such shares by third persons after the transfer of ownership to a Bank or Special Purpose Entity,
- Transfer of the shares to third parties to comply with certain legislation that bring special regulations pertaining to the shareholders.