Public Mergers and Acquisitions in Indonesia: Making the Offer
SSEK Legal Consultants partner Fahrul S. Yusuf and Michael S. Carl, a senior foreign legal advisor at the firm, have contributed the Indonesia chapter of the new Practical Law global guide to Public Mergers and Acquisitions. SSEK is one of the top M&A law firms in Indonesia, as ranked by leading independent legal directories including Chambers & Partners, IFLR1000, Legal 500 and Asia Law & Practice.
The following is an excerpt from Public Mergers and Acquisitions in Indonesia.
Making the bid public
A bid is made public in the case of either a:
- Mandatory Tender Offer (MTO) (which follows a change of control).
- Voluntary Tender Offer (VTO).
A takeover of a public company triggers an MTO, subject to certain exceptions. The timeline for conducting an MTO is as follows:
- At the latest one business day after taking control, the acquirer must:
- announce the completion of the takeover in one daily Indonesian-language newspaper with national circulation; and
- submit the announcement to the Financial Services Authority (OJK).
- At the latest two business days after the announcement of acquiring control, the new controller must submit a public disclosure of the MTO plan to the OJK.
- The new controller must announce the MTO plan in one daily Indonesian- language newspaper with national circulation at the latest two business days after receiving an OJK statement that the acquirer can publish the MTO public disclosure.
- The MTO begins one calendar day after the public disclosure announcement, with a 30-calendar day offering period. The MTO must be settled within 12 calendar days from the closing of the MTO period.
- The new controller must submit a report to the OJK on the results of the MTO at the latest five business days from the end of the settlement period.
The timeline for conducting a VTO is as follows:
- Prior to the offerer conducting a VTO, the offerer must submit a VTO statement to the OJK and at the same time publish the statement in at least two Indonesian-language newspapers (one of which must be circulated nationally). The following information must be included in the VTO statement:
- the identity of the target company;
- the shares to be acquired (including the offer price, time and method of acquisition);
- the terms and conditions of the VTO;
- the name of the stock exchange;
- the calculation of the share price;
- the information on the offerer;
- an explanation of any relationship between the offerer and the target company or its affiliates within the last three years;
- a statement from the offerer on the availability of funds, supported by an opinion from the accountant, bank or securities company involved;
- a statement of the purpose of the VTO;
- a statement of total shares owned by the offerer;
- a list of parties that are being compensated by the offerer in connection with the VTO (if any);
- an explanation of approvals or requirements imposed by the government in connection with the VTO (if any); and
- any additional information required to ensure that the VTO statement is not misleading.
- The statement of the VTO is effective:
- 15 calendar days following the date of receipt of the complete VTO statement from the OJK;
- 15 calendar days following the date of the last changes submitted by the offerer or the submission of other documents requested by the OJK; or
- following the receipt of a statement from the OJK stipulating that no further changes and/or additional information are required.
- The VTO offer must be made at the latest two business days following the effectiveness of the VTO statement, and must remain open for a 30-calendar day period (which can be extended for up to 90 calendar days), unless otherwise agreed by the OJK.
- The VTO must be settled within 12 calendar days after the offer period has lapsed.
- The offerer must submit a report to the OJK on the results of the VTO within ten business days from the end of the settlement period.
The above timetable cannot be altered (even if there is a competing bid).
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