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

4.1 General rules

There are three main forms of takeover bids in Chile:

(a) a voluntary takeover bid – A bidder voluntarily makes a tender offer for all or part of the shares issued by the target company (and securities issued by the company conferring the right to acquire shares of the target company);

(b) a mandatory takeover bid – The Securities Act requires that any acquisition of shares, whether direct or indirect, allowing the purchaser to obtain control of a listed company must be made through a tender offer in accordance with and subject to the tender offer rules included in the Securities Act (see 4.3).

There are five exemptions from the obligation to conduct a mandatory tender offer, namely:

• control obtained by subscribing for newly issued shares of the target company;

• acquisition of shares transferred by the controller of the target company in circumstances where (i) the shares have "market presence" (i.e., meet certain minimum trading thresholds); (ii) the price is payable in cash; and (iii) the price is not "substantially" higher than "market price" (currently, this means not more than a 10% premium over market average price).

• acquisitions that result from a merger;
• acquisitions that are a result of inheritance; and
• acquisitions resulting from judicial non-voluntary enforcement.

Other kinds of mandatory bids include the following:

• if, after an acquisition, the controlling shareholder reaches a two-thirds voting stake in the target company, it must launch a tender offer for the remaining shares; and
• if an individual or entity intends to take control over a company which in turn controls a listed company that represents more than 75% of its consolidated assets, the offeror must first launch a tender offer for the shares of the listed company for a number of shares that allows the bidder to take control over that entity; and

(c) a squeeze-out bid – A shareholder who has reached a 95% stake in the target company after a voluntary or mandatory tender offer can squeeze-out the remaining holders of shares. However, this right is subject to other specific requirements and may only be exercised by the controlling shareholder if the bylaws of the target company expressly authorize it.

Both mandatory and voluntary tender offers are subject to the same rules. Squeeze-out bids, in turn, are subject to more simple rules, given their nature.

4.2 Control

Under the Securities Act, an individual or entity, or group of individuals and/or entities with a collaboration agreement (acting in concert), would be considered to be controllers of a company if they, directly or indirectly through other individuals or entities, own shares issued by such company and have the power to (i) secure the majority of votes in shareholders' meetings and elect the majority of the members of the board, or (ii) decisively influence the administration of the company.

4.3 The tender offer process

(a) Tender offer commencement publications

One day before the commencement of the validity of the tender offer, the offeror must publish a "highlighted" tombstone advertisement in at least two national newspapers announcing that a tender offer is being launched (the "Tender Offer Commencement Publications"). At this point the tender offer becomes public. These Tender Offer Commencement Publications must include the essential elements of the tender offer so that any recipient, i.e., any existing shareholder, may correctly understand the terms of the tender offer.

The tender offer itself must have a validity term which cannot be shorter than 20 days nor longer than 30 days. However, in the event the shares are registered with securities depositaries, the term must be 30 days. Nevertheless, the tender offer term can be extended one time only for a minimum of five and a maximum of 15 additional days.

After the Tender Offer Commencement Publications are made, certain restrictions apply to the administration of the target company. For example, the company is precluded from selling relevant assets, redeeming shares, incorporating subsidiaries and increasing its indebtedness by more than 10%. Additionally, the target company is required to provide an updated shareholders' list to the offeror or bidder, and the directors of the company must issue an independent opinion on the convenience of the tender offer for the shareholders.

(b) Prospectus

The bidder is required to prepare and deliver a prospectus to the Commission, the stock exchanges and the target company on the same date the Tender Offer Commencement Publications are made. The prospectus must contain the terms and conditions of the tender offer and should be available to the shareholders of the target from the date the tender offer begins and throughout the entire period the offer is open.

The following information must be included in the prospectus:

• the shares and securities to which the tender offer relates, including the minimum number or percentage of shares required for the tender offer to be successful. The tender offer may be directed to obtain all or part of the shares, with no statutory minimum, except for the case in which the tender offer is launched for the shares of the subsidiary of a company in which the offeror intends to take control, in which case the offer must be for a number of shares that allows the bidder to take control over the company. If the maximum percentage is reached, then the bidder will acquire such number of shares from all shareholders who tendered their shares on a pro rata basis;
• price and payment conditions;
• the terms and sources of financing of the tender offer by the offeror. In case the bidder has obtained loans or capital contributions for these purposes it shall provide the necessary documents to evidence that it has or will have the funds required for the acquisition;
• any potential guarantees that may be offered in order to secure the seriousness of the offer; and
• any conditions that may trigger the revocation of the offer.

(c) General terms and conditions applicable to a tender offer

The tender offer is irrevocable for the bidder. However, the offer itself may contain objective conditions that may trigger the right to revoke it. Such conditions must be included in both the Tender Offer Commencement Publications and the prospectus and normally refer to material adverse changes.

In contrast to the bidder, acceptance by the shareholders may be retracted at any time during the term of the tender offer. This is especially important in the event a competing tender offer is launched at a higher price.

(d) Publication of the results of the tender offer

On the third day after the end of the tender offer period, the offeror must publish the result of the tender offer in the same newspapers on which the Tender Offer Commencement Publications were made. If the publications are not made in time, the shareholders will have the right to withdraw their acceptance. In any case, the results cannot be published later than 15 days after the end of the tender offer period.

4.4 Price and payment conditions

The price must be determined and may be paid in cash or publicly offered securities. It may also be increased during the offer period, which may be necessary, e.g., if a competing bid is made. Generally, there is no minimum or maximum price. An exception to this is in the case of a mandatory tender offer where, after the acquisition, the controlling shareholder reaches a two- thirds voting stake in the target company. In this case, the price should not be lower than the price to be paid to dissenting shareholders who exercised withdrawal rights in case those rights were triggered.

If, during the term within the 30 days prior the commencement of the tender offer and the 90 days after the publication of the notice of results, the bidder has directly or indirectly acquired or acquires shares subject to the tender offer in a higher price than the one offered during the tender offer, the shareholders who sold their shares to the bidder before or during the tender offer have the right to require the bidder to pay them the difference and match the highest price paid. Therefore, in case the price of the tender offer was higher, the shareholders who sold before the tender offer have the right to require the difference. Likewise, if the bidder acquires additional shares, at a price higher than the one paid at the tender offer, within the ninety-day period running from the publication of the results of the tender offer, the shareholders who tendered their shares would be entitled to claim the corresponding price difference.

4.5 Competitive bids

During the term of a tender offer, other offers may be launched. These competitive offers will be subject to the same rules applicable to the original bid. However, they will only be valid in case their respective Tender Offer Commencement Publications are published no later than 10 days before the end of the term of the original tender offer.

If the original tender offer is being conducted in a stock exchange, the competitive bids must be conducted under the same procedure and end on the same date. If the original tender offer has not been made in a stock exchange, the competitive bids may have a different end date. Notwithstanding the above, in both cases (in or outside a stock exchange), if the term of the original tender offer is extended, the competitive bids may only be extended in a way that their end date is the same as the new end date of the original tender offer.

Individuals or entities that are bidders in one of the competitive or original tender offers may not tender their own shares in the other offers.