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

The following is a description of the main steps that should be followed by a Bidder to execute a public takeover bid of a Target Company according to the OPA Regulations:

(a) Registration of the Target Company with SNV

The Target Company must be previously registered with the Registry of the SNV. Any registration must contain the following information with a letter:

1. General and financial information on the Target Company, its shareholders and administrators, including a copy of the Tax Information Registry (RIF), domicile, website address and social media accounts.
2. Information regarding the activities that the Target Company performs.
3. A two-page executive summary describing the products and services (relating to stock exchange matters) used by the Target Company.
4. Copy of the Articles of Incorporation/Bylaws.
5. Commercial, credit and banking references (three of each).
6. Certified statement by the Target Company, its shareholders and administrators declaring its solvency of, and its compliance with tax, labor, and social security obligations.
7. List of assets of the Target Company.
8. Statement of dividends and their payment schedule.
9. Any other document or information deemed necessary by the SNV.

(b) Request for SNV's authorization

The Bidder must file with the SNV a clear and detailed report on the offering ("Report") at least five stock market days before the date on which the bid is to be disclosed to the public, sufficiently supported so that the persons to whom the offering will be made may be reasonably aware of its content. The Report must be drafted in terms that an investor who does not have specialized financial knowledge can understand, and must contain, among other things, the following information:

1. An abstract of the Report ("Summary") containing the basic items of the Report which will allow an investor to have an idea of the proposed negotiation.
2. General and financial information on the Bidder and its administrators.
3. Information regarding the purpose of the offering, the Bidder's intentions concerning the Target Company and a description of the origin of the funds used to make the offering.
4. Information regarding the current shareholding percentage of the Bidder in the Target Company.
5. Information regarding the Bidder's relationship with the Target Company, its shareholders and administrators.
6. Specific conditions of the offering, including:
   • Number or percentage of shares of the Target Company that the Bidder wishes to acquire and a firm statement of intent to acquire them under the conditions proposed in the Report;
   • Price or exchange rate to be offered as consideration;
   • Payment conditions;
   • Guaranties offered to the sellers;
   • Term of the offering;
   • Rules for pro-rating, if any; and
   • Preparatory legal negotiations concerning the offering to which the Bidder is a party.
7. Description of the consequences arising from the application of certain special laws to the proposed transaction, such as the Law for the Protection and Promotion of Free Competition, the Banking Sector Institutions Law, or the need for authorization from any governmental agency, if required by law.

(c) SNV's authorization of the offering

The SNV has a period of five stock exchange business days to authorize the disclosure of the Report, starting on the date the report is filed by the Bidder. If the SNV requests that changes be made to the Report, this period shall begin to run from the moment the modified Report is filed by the Bidder.

The Report shall be confidential until its disclosure is authorized by SNV.

(d) Disclosure of the offering

Once disclosure of the Report has been authorized by the SNV, both the Report and its Summary must be circulated as soon as possible by means of:

1. Publication of the Summary in two national newspaper.
2. The filing of the Report with the Venezuelan stock exchange and the Target Company.
3. The publication of sufficient copies of the Report so as to deliver it to any person who requests it from the principal office of the Target Company or the Bidder.

(e) Term of the offering

The initial term of the offering shall be freely determined by the Bidder, but shall not be less than 20 stock exchange business days or more than 30 stock exchange business days after the actual starting date of the offering. This term may be extended before its expiration upon the Bidder's prior request for authorization from the SNV, which will have three stock exchange business days to decide on the extension. The extensions to the original term of the Offering cannot exceed a total of 30 stock exchange business days after the original date of expiration of the offering.

(f) Actions of the shareholders and administrators of the Target Company

From the moment the Report is disclosed, or before if they are aware of it, the controlling shareholders and administrators of the Target Company are prohibited from engaging in any actions other than the simple administration of the Target Company, without first sufficiently disclosing the information in connection with these actions to the SNV, the stock exchange and the mass media at least five stock exchange business days in advance of the acts. The SNV may make observations regarding acts of disposition and may order their publication.

(g) Observations on the offering by the Target Company

The Target Company shall submit its comments or observations regarding the offering to the SNV and the stock exchange no later than the fifth stock exchange business day following the disclosure of the Report. These comments shall be made public, upon prior notice to the SNV, by publication in two major national newspapers. The observations on the offering shall also be filed with the stock exchange and the Bidder. The Target Company may only make additional observations if any new events arise that call for them.

(h) Competing offerings

Any person may make a competing offering, thus becoming aBidder. They must file a Report on the competing offering with the SNV at least seven stock exchange business days before the expiration of the initial offering. This Report must meet all the requirements demanded of the original offering. Both the original offering and the competing offering shall be valid for the same term. For this purpose, the term of the original offering will be extended for it to concur with the competing offering.

(i) Modification of the Report

Any modification to the Report and any notification, memorandum or disclosure report must be submitted to the SNV for authorization, which will then have a term of three stock exchange business days to grant the respective authorization for disclosure.

Any Bidder of an offering may make bids improving the conditions of its offering up to the tenth stock exchange business day before the expiration date of its offering. The new conditions must be extended to all the shareholders of the Target Company that have already accepted the offering. The SNV has three stock exchange business days after the filing date to authorize the disclosure of the modified Report containing the new offering conditions. The term of the offering shall be extended for as many days as the SNV has taken to grant its approval, which shall not be more than three stock exchange business days, unless the SNV agrees on a longer term.

(j) Advertising of the offering

Any advertisement, promotion or disclosure of the offering must be submitted for authorization by the SNV at least three stock exchange business days prior to the date it is to be made.

(k) Acceptance of the offering

Acceptance of the offering must be communicated to the Bidder at the place, time and in the manner set forth in the Report. If at the time of closing the offering is not fully subscribed it, shall be deemed to be unsuccessful, unless the Report contains a contingency clause whereby an offering is considered fully subscribed if at least 75% of the shares have accepted the offering.

(l) Revocation of the offering by the Bidder

1. Until its starting date, the offering may be revoked at any time by means of a reasoned and justified statement, having first notified the SNV, filed it with the stock exchange and published it in two national newspapers.
2. From the starting date, the offering may be revoked up to three stock exchange business days before the closing date, by means of a reasoned and justified statement submitted for the SNV's authorization. However, this revocation may only be admitted:
   • if a competing offering is made; or
   • if there are exceptional circumstances not imputable to the Bidder.
3. Until the transaction is settled, the offering is revocable if there is a decision by any competent agency opposing or subjecting the transaction to other conditions.

(m) Repeal of the acceptance by the stockholders of the Target Company

The acceptance may only be repealed in the event of a competing offering or an outright bid, provided the acceptance has taken place prior to the competing offering or bid. The Report must expressly refer to this limitation.

(n) Notice of the outcome of the offering

The SNV, the Stock Exchange and the general public, by means of a notice published in two national major newspapers, must be notified of the outcome of the offering within two stock exchange business days following the closing of the Offering.

(o) Settlement and payment

The settlement of the transactions for acceptance of the offering shall take place at the stock exchange, pursuant to the methods authorized by the SNV, no later than the fifth stock exchange business day following the closing of the offering.

Set out below is an overview of the main steps for a public takeover bid in Venezuela.

5.1 Indicative timeline of a public takeover bid

Click here to view diagram for Venezuela.