MERGERS AND ACQUİSİTİONS İN TURKEY
Mergers and Acquisitions (“M&A”) is defined as the combining of two or more companies or buying-selling or dividing of two or more companies as a part of corporate finance in order to grow rapidly in business field of activity.
Pursuant to the TCC, Companies can be merged in two different ways:
- Acquisition of a company by another company, technically called “merger by acquisition” or
- Union of two companies under a new company, technically called “merger by formation of a new company”.
According to Article 136 of the Turkish Commercial Code 6102; the merger takes place when the acquiring company shares are acquired spontaneously by the shareholders of the transferred company in exchange for the assets of the transferred company and the merged and acquiring company takes over the assets of the transferred company as a whole. As soon as the merger decision is taken by the companies participating in the merger, the governing bodies shall register these resolutions and the transferred company shall be dissolved by registration (art.152). With this registration, the merger becomes valid. At the time of registration, the acquired company is transferred to the inherited company together with the assets and liabilities and becomes the shareholders of the companies that take over the partners of the transferred company (art. 153).
With the conclusion of the merger, the transferred company is finally terminated and deleted from the trade register.
The Trade Registry Office, in which the company that inherits the merger decision is registered simultaneously, shall notify the related property and rights registered in title deed, ship and intellectual property register and similar register, including property of the transferred company.
In the present TCC, the restrictive rule governing the merging of companies of the same type has been partially removed. Accordingly, the capital companies may be merged with the private companies provided that they are capital companies, cooperatives and the transferee company. Individual companies may be merged with capital companies and cooperatives provided that they are individual companies and the companies that are acquired.
It has become possible for a company in liquidation to join the union. There are two conditions are required for this: Firstly, the company in liquidation must be the company that was transferred. In addition the distribution of company’s assets should not be started.
The existence of these conditions is proved by the document submitted to the trade secretariat where the headquarters of the transferee is located.
It has also been possible to join a company that has lost its capital or is in debt. Such a company can be merged with a company that has lost capital or, if necessary, has the liberty to save money in a way that will compensate for the wreck. The existence of these conditions is proved by the document submitted to the trade secretariat where the headquarters of the transferee is located.
One of the dominant principles of unification is the «continuation and protection of partnership» principle, found the expression at article 140. The new TCC has set as an innovation that the companies participating in the merger can not only give the right to choose between the share and partnership rights in the merger contract, the partnership and the company that inherits the share value of the company shares to be acquired with the enterprise, but also the issuance of the split pension.
In the new TCC, the form of the merger agreement, its structure, its content and its approval by the general assembly and the merger report to be prepared are arranged in detail (TTC art.145,146,147).
The companies need consulting services during the merger process:
- Commercial law consultancy
- Negotiation and implementation of management package,
- Manage the Due diligences process,
- Obtaining administrative authorizations
- Negotiation and drafting of guarantees of assets and liabilities,
- Operations of acquisitions of assets, business assets or industrial assets,
- Operations of acquisitions and sale of shares,
- Constitution of Joint Ventures
- Reorganization of Company Structure and
- Cross-border transactions.
Türkiye’de Birleşme ve Devralmalar
Mergers and Acquisitions in Turkey
Av. M. Burak KÜÇÜKİSLAMOĞLU