A Public Acquisition Offer is a financial transaction in which a company or a group of investors proposes to buy a significant amount of shares in another company. With this measure, the CNV seeks to promote a more efficient and transparent capital market.
The National Securities Commission (CNV) changed the rules for the Public Acquisition Offers (OPAs) through a Resolution published this Monday in the Official Gazette.
Essentially, it is a regulatory update that modified the existing rules governing takeover bids. According to the official text, The amendment of the rules seeks to adapt the regulation to recent economic changes.
It is worth remembering that takeover bids are corporate actions in which a company or individual acquires a controlling stake in another company. The law is therefore intended to ensure that minority shareholders receive fair compensation in the event of a takeover bid.
The resolution details how it should be calculated Fair pricing and how to adjust it based on currency and exchange rate fluctuations.
Determination of fair price
- The price should reflect the true value of the shares, taking into account adjustments for exchange rate fluctuations.
- If the price is in foreign currency and cannot be paid in that currency, payment must be made in pesos using a specific exchange rate (BYMA Dollar Index or selling exchange rate of the Banco de la Nación Argentina).
- If the price is in pesos, it must be adjusted using the Badlar Rate in pesos.
Exceptions to the mandatory takeover bid
- The resolution establishes exceptions to the obligation to carry out a takeover bid in cases of privatization of public companies by the State and in judicially approved debt restructurings.
Other provisions
- Valuation methods: The resolution provides detailed guidelines for determining the fair price in a takeover bid, including the use of average trading prices and independent valuations.
- Transparency: The resolution emphasizes the importance of transparency and requires that certain information be published on the financial information highway.
Why is it important?
A Public Acquisition Offer (OPA) It is a financial transaction in which a company or a group of investors (the offeror) proposes to buy a significant amount of shares in another company with the aim of obtaining control of the latter.
In simpler terms, It is as if a company wanted to “buy” another smaller company or one with less capital. To achieve this, the offeror offers the shareholders of the target company a price for each share, which is usually higher than the current market value.
The standard is conducive to offering Investor Protection: The new rules aim to protect minority shareholders by ensuring that they receive fair compensation in the event of a takeover. The official text also states: that The changes are intended to promote a more efficient and transparent capital market.
He also argues that this resolution is a significant step by the Argentine securities regulator to strengthen investor protection and improve the regulatory framework for takeover bids. It provides a more detailed and comprehensive set of rules for carrying out takeover bids.
Source: Ambito
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