The recent issue of the departing and delisting of a large Greek aluminium and copper company has upset the lawmakers and legal practitioners.
In a nutshell, the Board of Directors of the above company decided its absorption by its subsidiary unlisted company in Belgium and therefore its delisting from the Athens Stock exchange. The plan was that the Belgian subsidiary would be listed on Euronext Brussels prior to the above absorption. As a result, the shareholders of the absorbed delisted company would receive in exchange shares listed on a foreign regulated market.
Under article 17 of Greek Law 3371/2005, in case of voluntary delisting of a company, the decision of the company’s General Assembly to delist must be taken with a majority of at least 95% of the share capital. This provision raised for long time uncertainties whether the same majority is required for the decisions of corporate transformations which result in the company’s delisting.
In April 2013, the above doubt came to an end after the enactment of Law 4141/2013 amending article 17 of Law 3371/2005. The last April’s amendment confirmed that the majority of 95% is also required for the decisions taken for corporate transformations (merger, absorption etc) resulting in the company’s delisting. However, an exception was introduced: The above majority is not applicable if, as a result of the transformation, the shareholders receive listed shares in exchange of the shares in the company to be delisted.
The above exception enabled the said Greek company to delist without need to comply with the high percentage of 95%. This ability possibly induced the government to proceed to a new amendment of Law 3371/2205. As a consequence, according to Law 4199/2013 amending again Law 3371/2005, a lower percentage of 90% is required when, as a result of a corporate transformation event, the shareholders of the company to be delisted receive shares listed on a non Greek regulated market. The above percentages, namely 95% and 90% are not required if the shareholders of the company to be transformed and delisted receive shares listed on a Greek regulated market.
According to the Explanatory Statement of the amendment, this high percentage is essential, regardless of the fact that shareholders receive or not listed shares, as in both cases the relevant decision of transformation is an extremely important event for the shareholders and mostly for the minority shareholders. On the other hand, there are concerns that such amendment may be an obstacle to the object of attracting new investors in Greece.