NON-LEGAL ASPECTS: Culture a Chinese negotiation team: State-owned Enterprises and Privately-owned Enterprises .European Negotiating Team(German/non-German) Hierarchical Structure of Enterprises Subordinate units and middle-management level have more discretion to decide issues independently Negotiating team will prepare strategy for realising project and will have power to decide with some flexibility(involve law department or attorney early) Negotiations to be realised within a certain timeframe and final contract will be prepared ePost-acquisition integration of different corporate cultures CESLELECTIVE-APRIL2016 16
CESL ELECTIVE - APRIL 2016 16 NON-LEGAL ASPECTS: Culture ▪Chinese Negotiation Team: State-owned Enterprises and Privately-owned Enterprises ▪European Negotiating Team (German/non-German): Hierarchical Structure of Enterprises - Subordinate units and middle-management level have more discretion to decide issues independently - Negotiating team will prepare strategy for realising project and will have power to decide with some flexibility (involve law department or attorney early) - Negotiations to be realised within a certain timeframe and final contract will be prepared ▪Post-acquisition integration of different corporate cultures
M&A: cnrc- Pirelli(Italy) Case 6 China National Tyre Camfin and Rubber co. ltd BidCo2 (manufacture 26.2% distribution) Other pirelli Takeover shareholders offer Chem China Pirelli Spa(listed) Antitrust issues Contract for Long-term State-owned Assets Industrial partnership Supervision and 'Two-step process Administration pirelli delisting Commission-SASAC Future structure of pirelli CESLELECTIVE-APRIL2016 17
CESL ELECTIVE - APRIL 2016 17 M & A: CNRC – Pirelli (Italy) CASE 6 ChemChina China National Tyre and Rubber Co. Ltd. (manufacture + distribution) State-owned Assets Supervision and Administration Commission-SASAC BidCo2 26.2 % Pirelli SpA (listed) Camfin Other Pirelli Takeover shareholders offer Contract for Long-term Industrial Partnership ▪Two-step process ▪Pirelli delisting ▪Future structure of Pirelli Antitrust issues ?
M& A: Chem China(BlueStar)-Elkem AS(Norway) Case 3 rev. China National Orkla Norway Sells BlueStar Group Co.(100% Ltd(non-listed) Elkem as Silicone, solar industry pecial metals and chemical Chem china Blackstone products(Norway, Iceland, 80%(Private Equity) Canada, China, Brazil, South 20 Africa Elkem Po? State-owned Assets Supervision and Antitrust BlueStar-Elkem Administration issues, etc. Investment Co td (HKG Sar) Commission-SASAC CESLELECTIVE-APRIL2016 18
CESL ELECTIVE - APRIL 2016 18 M & A: ChemChina(BlueStar) – Elkem AS (Norway) CASE 3 rev. ChemChina 80% China National BlueStar Group Co. Ltd (non-listed) State-owned Assets Supervision and Administration Commission-SASAC 100% Elkem AS Silicone, solar industry, special metals and chemical products (Norway, Iceland, Canada, China, Brazil, South Africa Orkla Norway Sells Blackstone (Private Equity) 20% BlueStar-Elkem Investment Co Ltd (HKG SAR) Elkem IPO? Antitrust issues, etc. ?
M&A: shenyang Machine Tool Group- SchieSs CASE 7 Phase I(prior to 2004) Schiess privatised, but Shenyang Machine Tool Group heavily undercapitalised owns 40 o Close to insolvency Phase ll(after 2004) Shenyang Machine Tool Group Schiess owns 100%o Shenyangs Undertakings nvest 40mE to make Schiess competitive Keep german workforce and expand if profitable Envisage Joint Venture with suppliers. CESLELECTIVE-APRIL2016 19
CESL ELECTIVE - APRIL 2016 19 M & A: Shenyang Machine Tool Group – Schiess CASE 7 Phase I (prior to 2004) Schiess privatised, but heavily undercapitalised Close to insolvency Phase II (after 2004) Shenyang Machine Tool Group owns 40 % Schiess Shenyang Machine Tool Group owns 100% ►Shenyang’s Undertakings Invest 40m € to make Schiess competitive Keep German workforce and expand if profitable Envisage Joint Venture with suppliers
CHOICE OF FORM I aBranch of a Chinese Company (head office located in PRC): Immediate Focus is not in entrepreneurial activities Liability concerns are not controlling Representative office(legal status? cost considerations some jurisdictions notification duties under trade law branch of a Chinese corporation (eu law terminology): file documentation with Commercial Registry or equivalent (incl. corporate charter of Chinese corporation): Legal representatives( board of directors) must have good standing(no breach of law) CESLELECTIVE-APRIL2016
CESL ELECTIVE - APRIL 2016 20 CHOICE OF FORM I ▪Branch of a Chinese Company (head office located in PRC): Immediate Focus is not in entrepreneurial activities. Liability concerns are not controlling. Representative Office (legal status?) - cost considerations - some jurisdictions notification duties under trade law - branch of a Chinese corporation (EU law terminology): File documentation with Commercial Registry or equivalent (incl. corporate charter of Chinese corporation): Legal representatives ( board of directors) must have good standing (no breach of law)