Spain to amend takeover bid regime for companies listed on multilateral trading facilities

The purpose of the Draft Royal Decree amending Royal Decree 1066/2007 of 27 July on the rules governing takeover bids is to develop the rules governing takeover bids and voluntary delisting applicable to companies listed on multilateral trading facilities (MTFs).

The Ddaft, which was in the hearing and public information phase until 17 January, aims to extend the general takeover bids regime applicable to companies listed on regulated markets to companies listed on MTFs, establishing certain specificities to adapt this general regime to the specific characteristics of companies listed on MTFs.

The most relevant specificities introduced by the draft are set out below.

Additional exceptions to the obligation to launch a takeover bid when control is reached

• When a percentage of voting rights of 30% or more but less than 50% is reached.
• When more than half of the directors are appointed, provided that 50% of the voting rights is not reached.
• When control is reached by the subscription of shares in a capital increase or as a result of the capitalisation, conversion or exchange of other issued securities, in both cases excluding the pre-emptive subscription right as it is addressed to one or several investors, provided that the corresponding resolutions are approved at the general shareholders' meeting with a 75% majority and the National Securities Market Commission (CNMV) verifies that these circumstances are met.

Indirect or supervening takeovers

The deadline for launching the takeover bid or disposing of the number of shares necessary to reduce the excess of voting rights over 50% is extended from three to twelve months.

Valuation report

The report justifying the price of delisting takeover bids must be prepared by an independent expert registered in a special register of company valuation experts created for this purpose within six months of the entry into force of the Royal Decree. Until the creation of this special register, valuation reports must be prepared by an independent expert who has communicated his willingness to be included in this register and has also participated in the valuation of a takeover bid authorised by the CNMV.

The CNMV will not intervene in the review and supervision of this report. 

Additional exceptions to the obligation to launch delisting takeover bids

• When the delisting resolution is approved at the general shareholders' meeting with a 75% majority and all shareholders are given the opportunity to sell their shares for one month at a price justified by an independent expert valuation report.
• When immediately after delisting the shares are admitted to trading on an MTF "growth market" (BME Growth) or on a regulated market.

Additional guarantees for takeover bids

In takeover bids with cash consideration (whether full or partial), apart from the bank guarantee or the cash bank deposit, the bidder may also provide, as security for the fulfilment of the obligations resulting from the takeover bid, documentation evidencing the granting of a loan or credit line to meet the payment of the consideration of the takeover bid.

Entry into force

The draft foresees that the Royal Decree will enter into force 20 days after its publication in Spain's official gazette, BOE, and the new regime will be applicable to takeover bids announced after its entry into force.