The CMVM allows KKR to benefit from an “exemption” from the obligation to launch a mandatory takeover bid for Greenvolt

CMVM has informed the market of a request to waive the assumption of attribution of voting rights within the scope of the OPA on Greenvolt. The regulatory body accepted the application with conditions.

CMVM received a request to waive the presumption of attribution of voting rights and, instead, implement negative evidence of dominance, by Gamma Lux Holdco, (in the meantime replaced by GVK Omega SGPS – subsidiaries of affiliated investment funds that received advice from KKR) – Company Kohlberg Kravis Roberts & Co. LP, the bidder), within the scope of the disclosure, on December 21, 2023, of the initial announcement of the public takeover offer (OPA) of Greenvolt – Energias Renováveis.

In other words, Gamma Lux requested to ignore the assumption of the existence of a shareholders' agreement to control the company, after concluding contracts for the purchase and sale of shares with the reference shareholders of Greenvolt with the aim of acquiring shares representing 60.86% of the capital. For that company (according to the information contained in the initial announcement mentioned above).

According to the law, “agreements regarding the transferability of shares representing the capital of the participating company are supposed to be an instrument for the coordinated exercise of influence.” This presumption can be rebutted before the CMVM, after demonstrating that the existing relationship with the participant is independent of the influence, actual or potential, on the participating company.

The exemption request stipulates that the company can benefit from not adhering to the overall allocation of voting rights.

“The orders arise after the conclusion of contracts for the purchase and sale of shares with the reference shareholders of Greenvolt with the aim of acquiring shares representing 60.86% of the share capital of that company (according to the information contained in the initial announcement mentioned above),” the CMVM statement said. .

GVK Omega, the composites (SPV) company created by Kohlberg Kravis Roberts (KKR) in North America, has launched a bid for Greenvolt.

At the time of the initial announcement of the tender offer, on 21 December, it was revealed that KKR had already reached an agreement with Greenvolt's major shareholders to acquire a total of 60.86% of Greenvolt. This is where seeking an exemption from attribution of voting rights pays off

These agreed acquisitions must only be completed as of May 31, 2024, after approval by the Portuguese Competition Authority and its counterparts in Romania, Ireland, the United Kingdom and Germany, according to the same memorandum.

In the statement sent at the end of the day on Friday, the CMVM says that “the above contracts imply the assignment to the Bidder (more than half of the voting rights corresponding to the share capital of Greenvolt – inherent in the shares that the Bidder may acquire) pursuant to a signed agreement with the stakeholders.” (…) The possibility of waiving the presumption referred to in Nos. 4 and 5 of Article 20 of the CVM will not apply, and only the duty to launch the public takeover offer that would arise from Article 187, paragraph 1 of the CVM will be required if the obligated person proves The CMVM finds that it does not have the authority to exercise dominant influence over the target company, under the provisions of paragraph 2 of the same article.”

But since “the above contracts are subject to conditions that have not yet been verified,” the offeror (KKR) “does not yet have ownership of the shares, that there are reference shareholders who, together, have a position greater than half of the voting rights and that no elements have been identified.” Demonstrating that the bidder has mechanisms that allow it to impose its will on the target company, the CMVM (…) finds that, according to the relevant evidence, the applicant cannot yet exercise a dominant influence over the target company The target company, with no need to launch a public takeover bid ( Mandatory) from now on.”

However, KKR is obliged to immediately inform the CMVM “of any change in the percentage of voting rights that leads to an increase greater than 1/prct. in relation to the previously reported situation” and “launch a public takeover bid as soon as it has the ability to exercise influence.” Dominant of the target company.