Implementation of the Large Holdings Directive in Slovenia

In 1997 Slovenia adapted the Takeover Act that regulates the methods as well as the terms and conditions of the purchase of shares in individual joint stock companies – issuers of securities when a natural or legal person acquires or wishes to acquire a share which, added to its existing holding, exceeds 25% of its voting stock (takeover). The Act refers to securities that can be traded on the stock exchange, i.e. to securities for which their issuer has successfully carried out a public takeover bid or has obtained a license for their continued public sale according to the law regulating the stock market activities.

Article 4 of the Takeover Act provides that the person or entity which acquires a share (the number or percentage of the total issue) in a joint stock company’s voting stock so that this stock, together with other existing securities in its portfolio, ensures it a voting right of not less than 25%, shall submit a public takeover bid to acquire these securities under the terms and conditions and in the manner laid down herein. Securities of the person or entity include:

  • voting shares,
  • voting shares acquired by a third party on behalf and for the account of the person or entity from above,
  • voting shares belonging to a company which is directly or indirectly dependent on the person or entity mentioned above or to the company that has a controlling interest in such person or entity,
  • securities with the right of conversion and purchase of voting shares,
  • a right to purchase voting shares at a specified date and at a price fixed in advance (options to purchase).

The takeover bid shall also be made by a person or entity which has already acquired less than 45% of the value of securities stated above by means of a successful takeover bid under this law and which has acquired an additional 5% of such securities on the completion of its takeover bid.

A public takeover bid according to the Takeover Act is a public announced proposal for the conclusion of an agreement for sale of securities of a particular company-issuer, which is addressed to all the holders of such securities. The public bid shall be published in a newspaper with nation-wide circulation. The bidder has the obligation to notify about his intention the Agency for Securities, the Management of the company –the issuers of the securities as well as the Office for Protection of Competition.

Prior to submitting his takeover bid, the bidder shall notify his intention of submitting a takeover bid to the Agency, the management of the company-issuer of securities, which are the subject of the bid, and to the competent authority for the protection of competition. The management of the company-issuer of securities that are the subject of the takeover bid shall notify the Agency of the agreements or negotiations with the bidder about the takeover within two business days. The takeover prospectus shall include all information, which is necessary to enable holders of securities that are the subject of the takeover bid to take an appropriate decision regarding the acceptance of the bid.

Article 64 of the Takeover Act also provides that when individual persons directly or indirectly acquires 5% of all shares, i.e. of the issuer’s other voting securities and a further 5% of securities (hereinafter referred to as ‘the qualified shareholding’), they shall notify it to the issuer of such securities and to the Agency not later than three business days from the date when they became aware or should become aware of their acquisition of such qualified shareholding. The issuer receiving the notification shall publish such notification not later than three business days after receipt thereof. If the person having in its possession a qualified shareholding fail to notify the issuer and the Agency within the time limit, he shall not be entitled to vote, i.e. to participate in the management of the company-issuer of such shares on the basis of the ownership of shares in excess of the qualified shareholding.

The article 79 states that the provision of the Company Act pertaining to associated companies shall also reasonably apply if a natural person acquires more than 95% of all shares of a joint stock company (exclusion of minority shareholders).

The Securities Market Act in the article 55 requires the securities issuers to disclose in the application for authorisation for organised trading and secondary public offering the data stipulated in the second paragraph of the Article 20 (stating the information to be disclosed when applying for granting of public authorization to the Stock Exchange), as well as to specify the persons holding at least 10% of the issue of securities to which the application refers. The securities issuer has to notify persons holding at least 10% of the issue of securities to which the application for organised trading with registered securities refers about the filing of the said application. In this notification, the issuer shall be obliged to inform the holders about the right to carry out a public offering with the purpose of secondary offering of the securities in question.

According to the Official Ljubljana Stock Exchange Rules, the issuer whose securities are listed on the official stock market, has to notify the names of the ten biggest security holders, as well as the total number of the security holders. Furthermore, the shares of securities held by the company’s board of directors’ members and managers have to be disclosed.

According to the Bank Act, if a bank is a holder of more than 10% threshold of another financial institutions’ capital, the latter must not own shares that would give it more than 10% of the total voting rights in the bank. For any person, to obtain a qualified shares of the banks’ capital (that is when it exceeds 10 per cent of the capital), the approval of the Slovene Central Bank must be obtained, as well as to increase the stake up to 20 per cent, 33 per cent, 50 per cent or to a share that would give to the shareholder a dominant influence in the bank. If the holder of the stated thresholds wants to diminish its share in the way that its stake in the company falls short of the approved above-mentioned thresholds, he must as well notify his intention to the Slovene Central Bank.

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