Changes to the way voting rights are calculated in public takeover bids and in minority shareholder squeeze-out and sell-out rights are being introduced through a provision included in a tax bill currently under public consultation in Greece. The provision amends Articles 27 and 28 of Law 3461/2006, with the aim of providing greater clarity in the legal framework governing takeovers of listed companies and the calculation of relevant shareholding thresholds.
The new regulation does not change the core threshold of 90% of voting rights required for a majority shareholder to exercise the squeeze-out right to acquire the shares of minority shareholders, nor does it alter the corresponding sell-out right of minority shareholders to exit. However, it changes the way this percentage is calculated by introducing a clear distinction regarding which voting rights are taken into account.
Under the new provision, only voting rights that can legally be exercised will be counted when calculating the 90% threshold. This means that certain categories of shares are excluded, including treasury shares held by the company itself and shares for which voting rights have been suspended. As a result, the percentage will now be calculated on the basis of active voting rights rather than on the total number of issued shares regardless of whether voting rights can be exercised.
Until now, Greek legislation referred more generally to the total voting rights of a company without clarifying whether this included shares without voting rights or shares whose voting rights could not be exercised. This lack of clarity had led to interpretative issues and different approaches in public takeover bids and corporate acquisitions, particularly in cases where companies held significant amounts of treasury shares.
The new provision clarifies that only voting rights that can legally be exercised are taken into account when calculating the relevant thresholds. This could affect both the timing and the conditions under which a bidder gains the right to compulsorily acquire minority shares or, conversely, becomes obliged to purchase them following a request from minority shareholders under sell-out rights.
At the same time, changes are also being introduced to the way voting rights are calculated for the thresholds that trigger the obligation to launch a mandatory public offer in listed companies. The new rule clarifies that only legally exercisable voting rights will be considered when determining whether a shareholder has crossed the thresholds that require the submission of a public takeover offer to the remaining shareholders.
The provision also updates the legislative reference governing treasury shares, replacing the old reference to Codified Law 2190/1920 with Article 50 of Law 4548/2018, which is the current Greek corporate law framework. In practice, this means that treasury shares, which carry no voting rights and are not counted for quorum purposes at general meetings, will not be included in the total number of voting rights used to calculate the thresholds that trigger a mandatory public offer.
This change could have significant practical implications for takeovers of listed companies in Greece. In cases where a company holds a substantial number of treasury shares, an investor’s ownership percentage will now be calculated on the basis of a smaller number of voting rights. As a result, a shareholder may reach more quickly the thresholds that trigger the obligation to submit a mandatory public offer or those that allow the exercise of squeeze-out rights over minority shareholders.
