In most cases, the bid process begins with the announcement of the intention to make a public takeover bid. This will usually be in the form of a press release stating that the parties have reached ‘conditional agreement’. This means that negotiations between an offeror and a target company have led to an agreement between the parties, whether conditional or unconditional, regarding the public takeover bid.
The takeover bid process may also start in other ways. For example, a hostile bid can begin due to the publication of ‘concrete information’ (see below). The provision of concrete information is in any case deemed to have occurred if the offeror publishes the name of the target company in combination with a proposed offer price or a preliminary timetable for the conduct of the proposed bid. This concrete information does not necessarily have to be published by the offeror in the form of a press release. However, a target company may prevent a public takeover bid from being announced under the rules relating to public takeover bids.
This requires a public statement from the target coming stating that the offeror and the target company are in consultation concerning the intended public takeover offer. Such statement must be published immediately after the offeror’s statement containing concrete information has been published. The offeror’s statement then no longer qualifies as the formal announcement of a public takeover bid under the rules relating to public takeover bids. This means that the regulatory periods set out in the rules relating to public takeover bids will not yet commence.
A third possibility is that the bid process starts with the announcement of a ‘mandatory bid’ (see below).
See the ‘Put up or shut up’ rule below for a description of a fourth possibility for for launching a public takeover bid.
The above does not affect the obligation of both the offeror and the target company to publish price-sensitive information without delay. For instance, this obligation applies in the event that information on preparations for a public takeover bid has been ‘leaked’.