The Swedish Securities Council has ruled Ateliere Creative Technologies’ decision to pull out of its acquisition of CodeMill is a “particularly serious breach” of the country’s takeover rules.
Last month, Ateliere announced it had decided against acquiring the workflow solutions provider, stating that “due to the current, unforeseen turbulence in the US and in the global business and financial markets”, the company was no longer in a position to complete the offer.
CodeMill accused Ateliere of violating the rules of the takeover, adding there was “no valid reason for Ateliere not to complete the offer”.
However, the Swedish Securities Council has said that because the shareholder acceptance period had expired and Ateliere had previously said that the deal would be completed, “a binding agreement exists between the bidder and the shareholders who accepted the offer”.
That meant that the offer could not be withdrawn, “even if there were previously any enforceable conditions for completion”, and Ateliere must pay the offer it made to CodeMill’s shareholders “as soon as possible”.
CodeMill originally warned it would consider legal action against Ateliere over the decision to drop the deal. In its latest announcement, the company said it has investigated the possibility for shareholders to take legal action.
“The conclusion of the investigation is that shareholders who have accepted [Ateliere’s] offer have the opportunity to pursue legal proceedings in general court against the bidder using their own resources,” said the company.
