What are the conditions for public companies to issue shares for swap with shares of pre-selected shareholders in other public companies in Vietnam?
- Conditions for public companies to issue shares for swap with shares?
- What are the conditions for public companies to issue shares for swap with shares of pre-selected shareholders in other public companies in Vietnam?
- What is the application of a public company registering to issue shares to swap shares of pre-selected shareholders in other public companies in Vietnam?
Conditions for public companies to issue shares for swap with shares?
According to the provisions of Article 49 of Decree No. 155/2020/ND-CP, a public company that issues shares for swap with shares must meet the following conditions:
- There is an issuance plan which is approved by the General Meeting of Shareholders of the issuer.
- The transfer of shares is restricted for at least 01 years from the ending date of the offering, unless otherwise dictated by an effective court judgment or decision, arbitral decision or a will as prescribed by law.
- The swapped shares or stakes are not restricted from transfer at the time of swapping according to regulations of the company's charter and the law.
- The latest annual financial statement of the company whose shares or stakes are swapped is audited by an accredited audit organization. The audit report has unqualified opinions.
- The issuance satisfies regulations on foreign ownership ratio.
- The swap does not violate regulations on cross ownership of the Law on Enterprises.
- There are opinions from National Competition Committee in case the swap causes the economic concentration to reach a level subject to notification.
- The interval between the private placements shall be at least 06 months form the ending date of the offering according to Clause 7 Article 48 of Decree No. 155/2020/ND-CP.
What are the conditions for public companies to issue shares for swap with shares of pre-selected shareholders in other public companies in Vietnam?
What are the conditions for public companies to issue shares for swap with shares of pre-selected shareholders in other public companies in Vietnam?
According to the provisions of Article 51 of Decree No. 155/2020/ND-CP, a public company that issues shares for swap with shares of pre-selected shareholders in other public companies must meet the following conditions:
- The conditions specified in Article 49 of Decree No. 155/2020/ND-CP are satisfied.
- There is a written agreement in principle of the swap subjects.
- In case the swap causes the holdings of the issuer and related persons in the public company to reach the level at which tender offer is mandatory as prescribed in Article 35 of the Law on Securities, the swap shall be subject to approval by the General Meeting of Shareholders of the public company whose shares are swapped.
What is the application of a public company registering to issue shares to swap shares of pre-selected shareholders in other public companies in Vietnam?
According to the provisions of Article 52 of Decree No. 155/2020/ND-CP, in order to swap shares of pre-selected shareholders in other public companies, a public company needs to prepare the following documents:
Application for issuance of shares for swap with shares of pre-selected shareholders in other public companies
1. The documents specified in Article 50 of this Decree.
2. There is a written agreement in principle of the swap subjects.
3. The decision of the General Meeting of Shareholders of the public company whose shares are swapped to approve the swap in the cases specified in Clause 3 Article 51 of this Decree.
For reference, Article 50 of Decree No. 155/2020/ND-CP stipulates the following documents:
- The application form No. 11 in the Appendix hereof.
- The decision of the General Meeting of Shareholders of the issuer to approve the issuance plan, which must specify: purposes of the issuance; intended quantity of shares to be issued; list of investors; intended quantity of shares to be swapped of each investor; method for determination and ratio of swap. Persons whose interests are relevant to the issuance must not vote.
- The written commitment of the organizations and individuals holding the shares/stakes that are swapped and the written confirmation of the legal representative of the company whose shares/stakes are swapped that the swapped shares/stakes of the investors are not restricted from transfer.
- The latest annual financial statement of the company whose shares/stakes are swapped that is audited by an accredited audit organization.
- A decision of the General Meeting of Shareholders or the Board of Directors (if authorized by the General Meeting of Shareholders) to approve the plan for assuring conformable foreign ownership ratio.
- The issuer’s commitment to not violate regulations on cross ownership of the Law on Enterprises.
- There are opinions from National Competition Committee in case the swap causes the economic concentration level to be subject to notification.
- Documents providing information about the issuance for the investors (if any).
- The decision of the Board of Directors to approve the application for issuance. For issuance of shares of a credit institution, the application shall also include SBV’s written permission for increase in charter capital in accordance with regulations of law on credit institutions. For issuance of shares of an insurer, the application shall also include the Ministry of Finance’s written permission for increase in charter capital in accordance with regulations of law on insurance business.
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