Challenges of the Knowledge Society (May 2017)
MANDATORY TAKEOVER BIDS ON ROMANIAN CAPITAL MARKET
Abstract
The Romanian Capital Market Law (Law no 297/2004) lays down rules regarding public offers (to buy or sell) of securities admitted to trading on a regulated market. Such offers are not unknown in the general framework of companies’ regulations, i.e. Company Law no 31/1990. Actually a public limited liability company (joint stock company) can use a public subscriptions (offering shares for sale) to raise the registered capital for incorporation of the company or to increase the company’s share capital already established. But all such operations are voluntary decisions. The founders or the shareholders of the company are those who decide to launch a public subscriptions. Capital Market Law comes with something new and at least peculiar at first sight: mandatory takeover bid, meaning a mandatory public offer made by an offeror to the holders of the securities of a company (offeree) to acquire all or some of those securities. Can someone be forced to buy securities on the regulated market? The Capital Market Law responds affirmatively, but only if such takeover bid follows or has as its objective the acquisition of control of the offeree company in accordance with national law. The takeover bid remains under supervision and authorization of the national authority of the Capital Market (FSA – Financial Supervisory Authority).
