[Last updated: 1 January 2025, unless otherwise noted]

4.1 General

In Austria, acquirers typically obtain control over listed companies in one of two ways. First, as most listed Austrian companies have a controlling shareholder, the acquirer may privately negotiate an acquisition of the controlling block of shares from the incumbent dominant shareholder. If successful, this transaction will typically trigger a mandatory bid and will thus be followed by a general cash offer to the remaining shareholders (see below). Where the acquirer follows this path, it is quite common in practice for the acquirer to conduct a (limited) due diligence review, and the agreement with the incumbent controller will often contain extensive representations and warranties in relation to the target company and its business.

Second, control can also be obtained by a general offer (a 'voluntary offer to acquire control'). Such offers may be launched regardless of whether or not the target company has a dominant shareholder, and they are subject to a statutory minimum acceptance threshold of 50% of the offer's addressees. The procedure is set out in more detail below.

It is far less common for listed companies to be acquired through statutory mergers, which in Austria require the payment of all or a substantial part of the consideration in shares of the surviving company. Triangular and/or cash-out mergers are not currently available to Austrian-incorporated companies.

4.2 Definition of control

Public offers are often launched as mandatory bids following a change of control over the target company. Control is defined in § 22 of the Austrian Takeover Act. Pursuant to this rule, control is deemed to have been obtained if a person owns or controls more than 30% of the voting shares in a company (controlling stake). Special rules apply in case control is obtained indirectly, e.g., by obtaining control over another company directly or indirectly holding a controlling stake in the listed target. In that case, where the company directly holding a controlling stake in the target is itself a listed company (pyramid structure), control is defined as above, i.e., with reference to the 30% threshold. However, where the direct controller is a closely held company, the ATC will determine whether or not control over that company has changed based on an assessment of the de facto influence of the (indirect) acquirer.

However, even where the 30% threshold is crossed, a shareholder will only be deemed to have acquired control if it has, in light of the shareholder structure and the usual attendance of shareholders in the annual general meeting, the majority of the voting rights in the shareholders' meeting of the target company. 

4.3 Parties acting in concert

Shareholders acting jointly to acquire or exercise control over a listed company, e.g., by coordinating the exercise of voting rights in the company's general meeting, are regarded as parties acting in concert. Shareholdings of the concert party are aggregated for the purposes of the mandatory bid rule (as well as in relation to significant shareholding disclosure rules).

4.4 Mandatory bid rule

A change of control over a listed Austrian company generally triggers an obligation for the new controlling shareholder (or group of shareholders/ shareholders acting in concert) to launch a mandatory offer to all other shareholders of the target company.

However, control may not only be acquired by direct or indirect acquisition of a controlling stake, but also by changes in the composition of a group of shareholders exercising joint control over a listed company, and even if the rights and obligations of the members within such group are amended, provided that such amendments result in a change of control within the group of shareholders.

A change of control within a group of shareholders requires all members of this group to launch a mandatory offer to all other shareholders of the company, provided that group of shareholders holds a controlling stake in that company.

Furthermore, a mandatory offers needs to be made if a controlling shareholder who holds more than 30% but less than 50% of the shares with voting rights acquires an additional (net) 3% or more of shares in the target company within a period of 1 year (creeping-in rule). The purpose of the creeping-in rule is basically to prevent circumvention of the mandatory bid rule.

4.5 Offers to acquire control

If a bidder owns less than 30% of the shares or no shares at all in the target company, it may launch an offer to acquire control. In order for such offer to be successful, the bidder will need to receive acceptances for more than 50% of the shares subject to the public offer (the 'market test'), whereas the bidder may voluntarily set a higher threshold, such as 75% or 90%. The latter threshold may be attractive for the bidder since, as a consequence of acquiring more than 90% of shares in the target company, the bidder may squeeze out the remaining shareholders and delist the target company (see 7).

Since, in the course of an offer to acquire control, the bidder will, if successful, end up with a controlling stake in the target company, most of the rules applicable to mandatory bids also apply to offers to acquire control.

4.6 Important rules only applicable to mandatory offers

• Unconditional offer – Other than offers to acquire control, mandatory offers may not be subject to any conditions. This is because the bidder acquires control in the first place. If the bidder was permitted to make its offer subject to conditions, the control it has acquired would not fall away in case of non- fulfilment of the conditions set. This would not only contravene the principle set out above under 2.3, but it would also contravene the Takeover Directive.
• Sufficient funds – A bidder may only acquire control if it has made sure that it has sufficient funds available to pay the offer price.
• Filing period of 20 trading days – Other than for all other types of offers, the bidder is required to file its offer document within a period of 20 trading days following the announcement of the offer (the filing period for all other types of offers is between 10 and 40 trading days).

4.7 Important rules applicable to mandatory offers and offers to acquire control

• Minimum price rule – The price offered to the shareholders of the target company must not fall short of the highest price paid by the bidder or any party acting in concert with the bidder within the period of 12 months prior to the filing of the offer document with the ATC. Furthermore, the offer price must at least correspond to the average market price of the shares in the target company within a period of six months prior to the bidder announcing its intention to launch an offer.
• Sufficient funds – A bidder may only announce the launch of an offer if it has sufficient funds available to pay the offer price.
• No parallel transactions – Once a public offer is made, the bidder and the parties acting in concert with the bidder must not acquire shares for a consideration higher than the offer price. If they do, the offer price must be increased to a level corresponding to the higher price paid.
• Mandatory cash offer – Although barter offers (where shares in the bidder company are offered for shares in the target company) are permitted under Austrian laws, a mandatory offer must include a mere cash alternative.
• Subsequent offer period – In case of a mandatory bid or a successful bid to acquire control, the offer must be extended by the bidder for another three months following the elapse of the initial acceptance period. This is mainly to give shareholders who have rejected the offer in the first place the opportunity to exit the company rather than stay in the company together with a bidder they have rejected.
• Equal treatment within another nine-month period – Within another period of nine months following the subsequent offer period, the bidder and parties acting in concert with the bidders must not pay a price for shares in the target company higher than the offer price. Exempted from this rule are, most importantly, higher payments of the bidder in the course of a squeeze-out or certain capital measures, such as a capital increase.

4.8 Partial offers

For partial offers, some of the important rules applicable to mandatory offers and offers to acquire control do not apply, such as the minimum price rule and the mandatory cash offer rule. Furthermore, as in case of offers to acquire control, partial offers may be subject to conditions.

Partial offers may be launched in the following scenarios:

• a person initially holding no shares in the target company or a shareholder holding a small stake in the target company intends to acquire such number of shares in the target company so that they end up with less than 30% of the shares with voting rights;
• the core shareholder holding more that 50% of the shares in the target company intends to increase its stake in the target company up to a certain threshold, such as 90%; and
• a company intends to acquire up to 10% of its own shares.

Even in the case of partial offers, the principle of equal treatment applies and no shareholders may be excluded from the offer. In case of oversubscription, the bidder must acquire the tendered shares pro rata.