Corporate M&A 2026 Comparisons

Current Market Climate

The mergers and acquisitions market has slowed noticeably over the past 12 months compared to previous peak periods. As a result, many investors have shifted toward applying a more cautious strategy, prioritising rigorous due diligence and valuation accuracy over transaction volume. This trend reflects a global preference for high-quality assets and sustainable growth in a more volatile economic environment.

Resilient Industrial Sectors

Despite this general cooling, the energy, oil, and gas sectors continue to see high levels of activity. This momentum is specifically bolstered by Senegal’s recent transition into production, marked by the first LNG exports from the Greater Tortue Ahmeyim field and the significant potential of the Yakaar-Teranga project. Global demand for energy security is driving strategic domestic and cross-border deals as companies seek to consolidate their market positions in these high-growth areas.

Energy and Natural Resources

The energy sector remains the primary driver of M&A activity in Senegal, particularly as the country has transitioned from an exploration frontier to an oil and gas producer. Furthermore, the mining industry continues to attract substantial investment, with a focus on gold and phosphate assets as global demand for these commodities remains high.

Financial Services and the Digital Economy

The financial services industry is undergoing a period of strategic consolidation as regional banking groups expand their footprints. There is also a notable increase in M&A activity within the fintech and digital payments space, driven by the high rate of mobile money adoption in the WAEMU zone. These transactions typically involve international investors seeking to acquire established local platforms to gain immediate access to Senegal’s rapidly growing consumer market.

Infrastructure and Telecommunications

M&A activity has also been recorded in the infrastructure and telecommunications sectors. As Senegal positions itself as a logistics hub for West Africa, a trend toward acquisitions of port facilities and transport companies by global operators has been evident.

Construction and Real Estate

Rapid urbanisation and infrastructure development drive interest in construction and real estate. Companies involved in residential, commercial, and industrial projects are often targeted for acquisitions, particularly by investors looking to capitalise on long-term urban growth.

Acquisition Methods

There are several legal approaches for acquiring a company in Senegal, each suited to the acquirer’s strategy and the target entity.

Purchase of Shares

This method involves acquiring all or part of the target company’s capital. It allows the buyer to gain control of the business directly. Transactions typically require shareholder agreements, thorough due diligence, and negotiation of the share price. One key advantage is maintaining the company’s existing legal structure, including its contracts and licenses. This method is governed by the Uniform Act on the Law of commercial companies and economic interest groups.

Merger or Absorption

Two companies may combine through a merger or absorption, consolidating their assets under a single legal entity. This method is suitable for rapid growth or sector consolidation and is governed by the Uniform Act on the Law of commercial companies and economic interest groups.

Joint Ventures and Strategic Partnerships

An acquirer can form a joint venture with the target company, contributing capital or expertise in exchange for a stake. This allows testing the market before full control and sharing risks with a local partner. In Senegal, there is no specific legal framework governing joint ventures; such arrangements are fully subject to the parties’ contractual freedom, meaning the terms, governance, and structure are negotiated and agreed upon between the partners.

Asset Purchase

The acquisition focuses on specific assets, such as property, equipment, patents, inventory, or contracts. This approach allows the buyer to select only desired assets while limiting exposure to unknown liabilities. It requires detailed asset purchase agreements, and often the consent of third parties, including creditors or clients. This method is governed by the Uniform Act on the Law of commercial companies and economic interest groups and the Uniform Act on General Commercial Law.

The Rise of ECOWAS Oversight

The ECOWAS Regional Competition Authority (ERCA) has effectively become the primary regulator for merger control in Senegal since becoming fully operational in late 2024. It now functions as a “one-stop shop” for transactions meeting specific regional turnover or asset thresholds. This supranational mandate ensures that mergers with a regional dimension are evaluated through a single, unified procedure across West Africa.

Sector-Specific Regulators

In addition to general competition rules, certain strategic industries are subject to oversight by specialised national bodies. For example, the Ministry of Petroleum and Energies plays a decisive role in approving transfers of interests or licenses.

Principle of Openness

Under Regulation No 06/2024/CM/UEMOA on External Financial Relations, the constitution of foreign direct investment or portfolio investment in a UEMOA member state is in principle free, provided that a declaration for statistical purposes to both the Ministry of Finance and the BCEAO is made. Declarations are submitted in writing, typically as a formal letter, without requiring prior approval or authorisation. The process ensures transparency and allows the BCEAO to monitor cross-border flows, but it does not limit the investor’s freedom to invest.

Senegal maintains a policy of openness toward foreign direct investment, a principle reaffirmed by the adoption of the 2025 Investment Code. Under this framework, foreign investors generally enjoy the same rights as local companies, including the freedom to acquire property and transfer capital. Most sectors are fully open to 100% foreign ownership without prior systematic screening or discriminatory barriers.

Local Content in Strategic Sectors

Despite this general openness, the energy sector is subject to strict “Local Content” requirements. Companies operating in oil and gas must prioritise Senegalese providers and, in many cases, open their shareholding to local investors or form partnerships with national entities. These regulations aim to ensure that the domestic economy benefits directly from the country’s recent transition into a major hydrocarbon producer.

Regulated Industries

Specific restrictions and licensing requirements also apply to other sensitive industries such as the advertising, transport, press and healthcare sectors.

Mergers and acquisitions in Senegal are governed by regional competition rules, derived from both WAEMU and ECOWAS competition law. This legal regime aims to preserve effective competition and prevent anti-competitive effects that may result from certain transactions.

Regional Regulatory Supremacy

The regulatory landscape for business combinations in Senegal is defined by the coexistence of regional and national antitrust rules.

UEMOA Competition Law and M&A

Regulation No 02/2002/CM/UEMOA prohibits anti-competitive agreements and concerted practices that have the object or effect of restricting or distorting competition. With regard to M&A, these rules particularly apply to agreements between parties.

The same regulation prohibits the abuse of a dominant position, including when mergers create or strengthen a dominant position that significantly impedes competition. Mergers, acquisitions of control and fully functional joint ventures are targeted when they produce such effects.

The WAEMU Commission is the competent authority for the application of competition rules within the community. Acting under the supervision of the WAEMU Court of Justice, it has decision-making power enabling it to examine the competitive effects of mergers.

ECOWAS Competition Law

In Senegal, mergers and acquisitions must also be assessed in light of ECOWAS competition law, as set out in Additional Act A/SA.1/12/08. This text prohibits concentrations, including mergers, acquisitions, and joint ventures, where they are likely to create a position of strength resulting in an effective reduction of competition in the ECOWAS common market or a substantial part thereof. The concept of dominance is broadly defined and covers situations in which one or more companies hold a sufficient market share to influence prices or exclude competitors, whether this dominance is individual or collective. The Supplementary Act prohibits not only the abuse of a dominant position, but also mergers that lead to such a situation, particularly when they restrict market access or distort competition. The application of these rules falls within the remit of the ECOWAS Regional Competition Authority (ECRCA), which has jurisdiction over transactions with a cross-border dimension or a significant impact on regional trade.

National Oversight and Coordination

On a national level, Senegal maintains its own competition laws to monitor domestic market dynamics.

Consequently, investors must carefully assess the geographical scope of a transaction to determine which layers of this multi-tiered regulatory framework apply to their specific deal.

In the context of an acquisition in Senegal, labour law is governed by the Labour Code and the National Interprofessional Collective Agreement (CCNI).

Labour Law Considerations in the Context of a Merger or Acquisition

The principle of legal continuity of employment contracts is a pillar of Senegalese labour law in the event of a transfer of business. Under the Labour Code, all existing individual contracts are automatically transferred to the new employer, who must maintain the acquired rights of employees. Acquirers cannot use the transaction as the sole justification for dismissing employees, as such dismissals would likely be deemed unfair by local courts.

Absence of General Screening

Certain mergers and acquisitions in Senegal may be subject to review for national security reasons, particularly when the target company operates in strategic sectors. Sectoral ministries and the Council of Ministers may examine whether a proposed transaction is likely to affect public order, national security or the provision of essential services. These authorities may require additional documentation or impose conditions.

In practice, there is no separate “national security authority” for mergers and acquisitions. The review is integrated into the approval process that certain ministries conduct for strategic sectors.

Operationalisation of the ECOWAS Competition Authority

The most significant legal development in the last three years is the full operationalisation of the ECOWAS Regional Competition Authority (ERCA) in late 2024. The authority is now empowered to review and issue binding decisions on any transaction that has a cross-border impact within the West African community.

Outlook

There are currently no significant indications that a major overhaul of takeover legislation is under official review for the coming year. Market participants can therefore expect the current legal status quo to persist throughout 2026.

Prevalence of Stakebuilding

It is not customary for a bidder to build a stake in a target company prior to launching a formal offer in Senegal. Indeed, the acquisition process is typically centralised through direct negotiations with the majority shareholders rather than through gradual market accumulation.

Shareholding Disclosure Obligations

Absence of legal thresholds for private companies

In the OHADA legal framework applicable in Senegal, there are no statutory shareholding disclosure thresholds or filing obligations for private (non-listed) companies.

Legal thresholds for listed companies

Under Senegalese law, particularly for companies listed on the BRVM (Regional Stock Exchange), threshold-crossing disclosure requirements are governed by the General Regulations of the AMF-UMOA (formerly CREPMF) and Instruction II-C of the BRVM relating to the disclosure of information.

Any natural or legal person, acting alone or in concert, who comes to hold or ceases to hold a fraction of the capital or voting rights equal to or greater than the following thresholds must inform the market:

• 10%;
• 20%;
• 33.33% (one-third);
• 50%; or
• 66.66% (two-thirds).

Beneficial Ownership Registration

While there are no shareholding thresholds for private companies, a recent regulatory shift requires all companies to disclose their ultimate beneficial owners.

Under Senegalese law, a company’s flexibility to change the thresholds for reporting shareholdings depends on its status (listed or private).

Modification of Reporting Thresholds

Listed companies (BRVM)

For listed companies, the legal thresholds (10%, 20%, 33.33%, 50% and 66.66%) are regional public policy (AMF-UMOA).

• Lower thresholds: A company may introduce lower reporting thresholds (eg, 2.5% or 5%) into its articles of association to increase transparency. These “statutory” thresholds are commonly used to monitor the rise in capital of potential predators.
• Higher thresholds: It is strictly prohibited to raise the legal thresholds or remove the 10% reporting requirement, as this would violate financial market protection rules.

Private companies (non-listed)

In the OHADA area, the principle of freedom of contract allows shareholders to set out the rules for transferring securities in the articles of association or in a shareholders’ agreement. Although there are no legal reporting thresholds for private companies, the parties are free to stipulate enhanced disclosure requirements to monitor changes in capital.

Approval and Pre-Emption Clauses

The main obstacles to stakebuilding lie in the restrictive clauses included in the target company’s articles of association. The approval clause is the most common; it makes any transfer of securities to third parties subject to the prior approval of the other shareholders or a corporate body. At the same time, the pre-emption clause allows existing shareholders to acquire priority rights to the securities being transferred, thereby preventing an external investor from building up a significant stake without the agreement of the existing partners.

Other Protective Measures

Beyond the articles of association, shareholder agreements often contain “standstill” clauses that prohibit a signatory from increasing their stake for a specified period.

Dealings in Derivatives

OHADA framework

Under OHADA law, the Revised Uniform Act on Commercial Companies and GIE (AUSCGIE, Article 744, paragraph 6) explicitly allows joint-stock companies (sociétés anonymes) to enter into financial contracts, including derivatives, subject to authorisation by the competent authority in each member state. However, OHADA does not provide a detailed definition, procedural rules, or a specific regime for derivatives, which creates a gap in practical guidance.

UEMOA regulation

At sub-regional level, the AMF-UMOA and BCEAO regulate financial transactions. Règlement No 06/2024/CM/UEMOA permits residents to engage in derivatives transactions with approved intermediaries or banks for hedging currency and price risks, and non-residents may also transact under certain conditions. Instruction No 66/CREPMF/2021 allows collective investment schemes (OPCVMs) to invest in derivatives on BRVM-listed instruments or approved OTC markets, subject to strict conditions. Derivatives must be used primarily for hedging purposes, and certain activities, such as short-selling, remain prohibited for investment vehicles.

Reporting Obligations for Derivatives

Securities and disclosure laws (AMF-UMOA/BRVM)

For companies that issue securities to the public or are listed on the BRVM, the use of derivatives triggers strict transparency requirements, as follows.

• Financial reporting: Companies must disclose off-balance sheet commitments, including forward financial instruments and derivative contracts used, in the notes to their summary financial statements.
• Material information disclosure: If the conclusion of a derivative contract is likely to have a significant impact on the share price or financial situation, the issuer is required to issue an immediate press release under the supervision of the AMF-UMOA.
• Specific reporting for funds: According to Instruction No 66/CREPMF/2021, undertakings for collective investment (UCITS) must periodically report to the regulator their overall exposure to risks arising from derivatives in order to verify compliance with leverage limits.

Competition Law Scrutiny (UEMOA and National Law)

In terms of competition law, derivatives are mainly monitored when they impact the control structure of a company.

• Stake building and control: Derivatives giving access to capital (call options, warrants) are taken into account by the UEMOA Commission to determine whether there is a change of control. If the exercise of derivative rights exceeds concentration thresholds (generally based on cumulative turnover in the Union), prior notification is mandatory.
• Price transparency: Although the OTC derivatives market is private, pricing practices or agreements involving financial instruments could theoretically fall under the prohibitions on abuse of dominant position or anti-competitive agreements if they distort the regional market.

Disclosure of Acquisition Purpose – Private Companies (Non-Listed)

For private companies governed by the OHADA Uniform Act, shareholders are under no legal obligation to disclose the purpose of their acquisition or their intentions regarding future control. The transaction is primarily a contractual matter between the buyer and the seller. Any such transparency requirements would have to be specifically stipulated in the company’s articles of association or a private shareholders’ agreement.

Disclosure of Shareholdings (Listed Companies)

Mandatory statement of intent

A critical component of the notification (specifically via the official Form I-P) is the declaration of objectives for the next 12 months.

Absence of Mandatory Disclosure Stages (Non-Listed)

Under the OHADA legal framework, there is no specific statutory rule defining a precise stage at which a private target company must disclose a potential transaction. Neither the initial approach, the start of negotiations, nor the signing of a non-binding letter of intent triggers a formal disclosure obligation to the public. This lack of a legal “trigger” allows parties to maintain a high degree of confidentiality throughout the sensitive preliminary phases of an acquisition.

While there is no general public disclosure rule, the target must strictly adhere to the notification procedures set forth in its own articles of association (statuts). These internal “disclosure” requirements typically arise when pre-emption or board approval (agrément) clauses are triggered, which often occurs just before or upon the signing of definitive agreements. Failing to notify existing shareholders or the board according to these specific contractual timelines can jeopardise the legal validity of the entire share transfer.

Disclosure Stages for Listed Companies

For listed companies in Senegal (BRVM/UEMOA context), the timing of disclosure is primarily governed by the AMF-UMOA General Regulation and the OHADA Uniform Act on Commercial Companies (AUSCGIE). In this jurisdiction, the requirement to disclose a deal follows a strict “permanent information” principle.

First approach and early negotiations

At the stage of a first approach or initial negotiations, there is no immediate requirement to disclose the deal. The target company and the acquirer typically maintain strict confidentiality to protect the integrity of the negotiations and prevent premature market speculation.

Leak or abnormal market activity

Under the principle of Permanent Information, listed issuers must bring to the public’s knowledge “as soon as possible” any precise information that, if made public, would likely have a significant influence on the share price.

Non-binding letter of intent (LOI)

A non-binding LOI does not generally trigger a disclosure obligation unless it contains a firm intention to launch a public offer or represents a “material fact” that has become certain enough to impact the market.

Definitive agreement (signing)

Disclosure is mandatory and immediate upon the signing of definitive agreements (eg, a Merger Agreement or a Share Purchase Agreement)

The target must publish a press release via the BRVM to inform the market of the transaction’s terms, price, and strategic rationale.

General Market Practice

In practice, the timing of disclosure is primarily driven by the parties’ desire for confidentiality rather than by strict legal mandates. Most private M&A transactions in Senegal remain strictly confidential until the definitive agreements are signed or even until the closing is finalised. This approach allows the parties to conduct due diligence and negotiate key terms without alerting competitors, employees, or the broader market prematurely. As for listed companies, they are required to comply with legal requirements.

The due diligence process in mergers and acquisitions in Senegal is generally exhaustive, and covers all of the target’s operational and legal risks. Investors favour a full-scope approach in order to identify any latent liabilities that could affect the valuation or viability of the transaction.

Corporate and Governance Matters

Due diligence usually starts with a review of corporate law compliance. This includes verification of the company’s incorporation documents, articles of association, and corporate registers, as well as compliance with statutory formalities under OHADA law. Particular attention is paid to decision-making processes to ensure that past and current corporate actions were properly authorised, so as to avoid any risk of nullity. Registrations of securities, pledges, or privileges at the RCCM are also carefully reviewed.

Tax And Customs Audits

Verification of tax and customs compliance is one of the central pillars of the audit due to the discretionary and rigorous nature of the local administration.

Labour Law and Social Liabilities

The social audit is an essential step in assessing the company’s personnel-related commitments and the stability of its social climate.

Regulatory Compliance and Litigation

The regulatory component focuses on the validity of operating licences and compliance with local content rules, particularly in strategic sectors such as energy. The audit also includes a comprehensive review of major contracts, securities and the history of ongoing or potential litigation. This risk mapping allows for the adjustment of warranty clauses and the definition of the conditions precedent necessary to secure the transaction.

Contracts and Commercial Relationships

The due diligence typically covers the company’s material contracts, including customer and supplier agreements, financing arrangements, and strategic partnerships. The aim is to assess change-of-control clauses, termination risks, and potential liabilities.

In Senegal, exclusivity arrangements are commonly requested, while standstill commitments are less frequent and depend on the structure of the transaction.

Exclusivity

Exclusivity clauses are widely used in negotiated business combinations, particularly in private M&A transactions. They are typically agreed at an early stage, often in a letter of intent or memorandum of understanding, and aim to secure the buyer’s position during the due diligence and negotiation phases. Exclusivity generally prevents the seller from soliciting or negotiating with competing bidders for a defined period. In practice, these clauses are contractually enforceable under OHADA law, provided they are limited in time and scope and do not amount to an unlawful restriction of competition.

Standstill

Standstill commitments are less common in Senegal, and are mainly encountered in public or semi-public transactions. In private transactions, sellers tend to rely more on confidentiality and exclusivity rather than standstill undertakings.

Takeover Bid Agreements

Permissibility and framework

It is permissible for the terms and conditions of a takeover bid to be set out in a definitive agreement (often referred to as a Merger Agreement or Transaction Agreement) between the offeror and the target company. Senegalese law, under the OHADA Uniform Act on Commercial Companies (AUSCGIE), does not prohibit such recording of general terms (price, timetable, conditions precedent).

Contractual Freedom Versus Regulatory Constraints

While the principle of freedom of contract allow parties to structure the deal through binding agreements, this freedom is supervised in the context of listed companies.

• Listed companies (BRVM): The terms agreed upon must comply with the AMF-UMOA General Regulation. Once a definitive agreement is signed, the “Permanent Information” rule triggers immediate disclosure if the information is precise and likely to impact the share price.
• Irrevocability: Under regional market rules, once an offer is filed with the AMF-UMOA, it becomes generally irrevocable. Therefore, any “conditions precedent” included in the definitive agreement must be clear, objective, and compliant with the regulator’s requirements to avoid being deemed void.

Absence of Statutory Duration

There is no legally mandated timeframe for the overall process of acquiring or selling a business in Senegal. The duration of a transaction is primarily determined by the complexity of the target’s operations, the depth of the due diligence required, and the pace of negotiations between the parties.

Impact of Regulatory Approvals

The most significant factor affecting the timeline is the requirement for regulatory clearances. Since the ECOWAS Regional Competition Authority (ERCA) became fully operational, merger notifications for large-scale deals typically require a review period of 60 to 90 days, which can be extended if the authority requests additional information. Furthermore, in regulated sectors, obtaining mandatory prior authorisations from the relevant ministry can add several months to the conditions precedent phase.

Private Companies (Non-Listed)

For private companies governed strictly by the OHADA Uniform Act (AUSCGIE), there is no mandatory offer threshold defined by law.

• Contractual nature: In the absence of a listing, a change of majority control does not automatically trigger an obligation to buy out the remaining shareholders.
• Exceptions: Such obligations only exist if they have been specifically negotiated and included in the company’s articles of association or a shareholders’ agreement (eg, through tag-along clauses).

Predominance of Cash Consideration

Cash remains the most commonly used consideration for M&A transactions in Senegal. This preference is driven by its simplicity and the immediate liquidity it provides to sellers, as well as the relative complexity of valuing and transferring shares in private companies under the OHADA Uniform Act.

Earn-Outs and Price Adjustment Mechanisms

In industries characterised by high valuation uncertainty, parties increasingly rely on earn-outs. These clauses allow a portion of the purchase price to be deferred and made contingent upon the target reaching specific financial or operational milestones (eg, EBITDA targets). Locked-box and completion accounts mechanisms are also standard tools used to manage value leakage between signing and closing dates, providing a clear framework for price adjustments based on actual net debt or working capital at the time of transfer.

Escrow Accounts and Vendor Loans

To further bridge value gaps and secure potential indemnity claims, the use of escrow accounts (often held by local or regional commercial banks) has become a market standard. A fraction of the price is held in escrow for a defined period (usually 12 to 24 months) to cover warranties and indemnities (W&I) risks.

In Senegal, public tender offers (OPAs) on BRVM-listed companies are generally structured with several standard conditions to protect both the acquirer and the target, while ensuring transparency for the market.

Common Conditions

• Regulatory approvals: Completion may be subject to approvals from the AMF-UMOA, BRVM, or relevant sectoral ministries for strategic sectors.
• Minimum acceptance threshold: The offer may specify that it will only proceed if a certain percentage of the target’s shares are tendered, often linked to control or governance considerations.
• Financing conditions: Offers often depend on the acquirer securing adequate financing to complete the transaction.
• Other customary conditions: For example, confirmation of representations and warranties, no breach of covenants, or absence of legal proceedings that could materially affect the target.

Regulatory Restrictions

The AMF-UMOA and BRVM impose disclosure and fairness requirements but generally do not prohibit the inclusion of conditions, provided they are clearly stated, objective, and not designed to evade transparency obligations.

Conditions cannot circumvent mandatory disclosure thresholds or mislead shareholders. Any condition must also comply with sector-specific rules and OHADA corporate law.

Minimum Acceptance Condition & Control Thresholds

The usual minimum acceptance (or waiver) threshold is set at 50% of the capital or voting rights.

Crossing the 50% threshold legally marks the effective takeover of the target company.

Financing Conditions in Business Combinations

Use of conditions precedent (CPs)

It is permissible in the Senegalese market for a business combination to be subject to a condition precedent (CP) regarding the bidder obtaining necessary financing. In private M&A transactions governed by the OHADA Uniform Act, parties enjoy broad contractual freedom to include a “financing out” clause. This allows the acquirer to withdraw from the transaction without penalty if they fail to secure the required funds from banking institutions or investors within a specified timeframe, provided they have acted in good faith to obtain such financing.

Market Practice and Certainty

While financing CPs are common, sellers often push for high standards of “certainty of funds” to minimise execution risk. Furthermore, the clause is often drafted to require the bidder to demonstrate that they have made all reasonable efforts to secure the loan, sometimes including a “break-up fee” if the deal fails specifically due to a lack of financing despite these efforts.

Deal Security Measures

Common contractual protections

Bidders in Senegal frequently seek various deal security measures to protect their investment during the interim period. Non-solicitation provisions (or “no-shop” clauses) are standard, prohibiting the target or its shareholders from actively seeking alternative bids.

While matching rights (allowing the initial bidder to meet a competing offer) are frequently negotiated, “force-the-vote” provisions are less common due to the high concentration of shareholding in most Senegalese private companies, where the support of a few key blocks is usually sufficient.

Regulatory impact on interim periods

The regulatory environment has significantly evolved, impacting the length of interim periods between signing and closing. The most notable change is the full operationalisation of the ECOWAS Regional Competition Authority (ERCA). Since 2024/2025, the requirement for regional merger clearance for large-scale transactions has standardised interim periods to align with the ERCA’s review timelines (typically 60 to 90 days). This supra-national oversight, combined with sector-specific requirements for example in the energy sector, has generally extended the “gap” period, requiring parties to include more robust interim covenant protections in their definitive agreements.

Interim covenants and governance

To manage the risks associated with longer interim periods, bidders typically impose strict interim operating covenants. These clauses require the target to conduct its business in the “ordinary course” and prohibit significant actions – such as asset disposals, new debt incurrence, or changes to employment terms – without the bidder’s prior written consent. In 2026, these measures are essential to ensure that the value and operational integrity of the target remain intact until all regulatory approvals, particularly from ECOWAS and national bodies, are obtained.

Alternative Governance Rights

Contractual control via shareholders’ agreements

When a bidder holds less than 100%, governance is primarily secured through a shareholders’ agreement (SHA which allows the bidder to negotiate rights that exceed their theoretical voting power, such as the mandatory appointment of a specific number of directors or the nomination of key executives (CFO, Technical Director).

Veto Rights and Reserved Matters

Bidders typically secure veto rights over Reserved Matters – strategic decisions that require their express consent regardless of their shareholding.

Observer Rights and Reporting

Rights to receive regular financial and operational reports or appoint a board observer to stay informed without formal voting power.

These rights are usually negotiated contractually through shareholders’ agreements or in the transaction agreement, particularly when the acquirer cannot obtain full control.

They must comply with OHADA corporate law, the target’s statutes, and, for listed companies, BRVM/AMF-UMOA disclosure rules.

Proxy Voting Rights

Legal principle and permissibility

Under the OHADA Uniform Act, every shareholder has the right to participate in and vote at General Meetings, either in person or by proxy. This right is a matter of public policy and cannot be suppressed by the company’s articles of association (statuts).

Conditions for appointing a proxy

The law allows a shareholder to be represented by another person (another shareholder, unless the company’s statutes provide otherwise. The statutes may also set limits on the number of votes or associates that a single proxy can represent. This ensures that representation remains fair and prevents excessive concentration of voting power in the hands of one individual.

The Public Withdrawal Offer (OPR) and Squeeze-Out (Listed Companies)

For companies listed on the BRVM, the main mechanism is the Public Withdrawal Offer, which can result in a compulsory withdrawal (squeeze-out).

• Public withdrawal offer (PWO): refers to a public takeover bid targeting a company’s minority shareholders, with the stated objective of having the majority shareholders delist the issuer’s securities.
• Conditions for triggering: A PTO may be authorised for any holder (alone or in concert) of securities representing more than the majority of voting rights, when the remaining securities in the public domain are held by fewer than 100 persons.
• Price guarantee: If the takeover bid takes place less than one year after an initial offer (takeover bid or public exchange offer), the initiator is required to guarantee minority shareholders the same price or consideration as in the previous offer.

In the Senegalese jurisdiction, governed by OHADA law and UEMOA regional market regulations, obtaining irrevocable commitments from principal shareholders is a standard practice for securing the success of a transaction.

Commonality and Nature of Undertakings

It is common practice to obtain such commitments (often called “irrevocable undertakings” or “hard/soft lock-ups”) to ensure that the necessary thresholds for control are met.

• For listed companies (BRVM): Commitments typically take the form of an undertaking to tender shares to a public offer (offre publique d’achat – OPA).
• For private companies: Commitments usually involve an undertaking to vote in favour of a merger or a direct agreement to sell shares.
• Legal basis: These undertakings are governed by the principle of freedom of contract and the ability of shareholders to conclude extra-statutory agreements to organise the transfer of securities.

Stage of Negotiations

Negotiations for these commitments generally occur at the pre-announcement stage, as follows.

• Listed context: Negotiations are undertaken before the official filing of the draft offer with the AMF-UMOA, allowing the offeror to announce that they have already secured a significant percentage of the capital.
• Confidentiality: During this phase, strict confidentiality must be maintained to avoid market manipulation or insider trading.
• Private context: They are often negotiated simultaneously with the Letter of Intent (LOI) or the definitive share purchase agreement (SPA).

For companies listed on the BRVM, a bid is made public through a formal process managed by the Bourse Régionale under the supervision of the AMF-UMOA. The process begins with the publication of an avis de dépôt du projet d’offre, which presents the main terms of the bid, including the identity of the initiator, the securities involved, the price or exchange terms, and the intermediary SGI handling the offer.

Once the bid receives the approval (visa) of the AMF-UMOA, the Bourse publishes the avis d’ouverture de l’offre publique, officially opening the offer period. The duration of the offer and any extensions are also announced publicly. All subsequent stages, including submission of securities, final results, or the declaration of a bid as without result, are communicated through official notices to ensure transparency and equal access to information for all investors.

In Senegal, the issuance of shares as part of a business combination, such as a merger, acquisition, or exchange of capital, is subject to multiple layers of disclosure under OHADA/AUSCGIE and UMOA capital market regulations for listed companies. The goal is to ensure transparency, protect shareholders, and maintain market integrity.

For unlisted companies, disclosure is primarily governed by the AUSCGIE, which requires the board and management to inform shareholders about the purpose and terms of the proposed capital issuance, in order for them to vote for or against the transaction.

This information is usually communicated in board reports, general meeting notices, and statutory filings.

For listed companies on the BRVM, disclosure is more formalised. A public notice is published via the BRVM, detailing the number of shares issued, subscription terms, exchange ratios, and schedule.

In the Senegalese jurisdiction, bidders are required to provide comprehensive financial disclosure within the framework of OHADA law and the AMF-UMOA (formerly CREPMF) regional market regulations.

Requirement for Financial Statements

Bidders must include detailed financial information in their disclosure documents, particularly the Information Note (note d’information) required for public offers.

• Mandatory inclusion: For any public offer (OPA/OPE), the initiator must present financial statements for the last two fiscal years.
• Content: This disclosure must include the balance sheet, income statement, and reports from the statutory auditors (Commissaires aux Comptes).
• Pro forma information: While not explicitly named “pro forma” in the general principles of the Regulation, the initiator is required to provide an activity program for the next two fiscal years. This involves forward-looking financial projections and the industrial/financial objectives pursued through the acquisition.
• Target response: The target company must also submit a report to the regulator within 15 days of notification, providing its own financial situation and the motivated opinion of its Board of Directors.

Required Accounting Form and Standards

• Financial statements in Senegal and the broader UEMOA zone must be prepared according to strictly defined regional standards.
• SYSCOHADA: The mandatory accounting framework is the OHADA Accounting System (SYSCOHADA). All commercial companies registered in an OHADA member state must establish their summary financial statements in accordance with this system.
• IFRS for listed companies: For companies listed on the BRVM, there is a requirement to align with international standards. Since the 2017/2018 reforms, OHADA has integrated IFRS standards for the consolidated financial statements of listed companies and those making a public appeal for savings.
• Certification: All financial statements included in disclosure documents must be certified by one or more authorised statutory auditors.
• Interim statements: If the last approved balance sheet is more than six months old at the time of a merger project or a public offer, the bidder may be required to provide intermediate financial statements or an updated accounting statement.

In the Senegalese jurisdiction, the disclosure of transaction documents for listed companies is primarily governed by the requirement to establish a comprehensive Information Note (note d’information), rather than a requirement to publish all primary transaction agreements (such as the SPA or Merger Agreement) in their entirety to the general public.

While the public sees a summary, the AMF-UMOA (the regulator) has broader access. The initiator and target must submit the following.

• Corporate resolutions: Copies of the text of resolutions from the General Meetings (Ordinary or Extraordinary).
• Full dossier: The regulator can require “directly from candidates all additional information it deems useful” – this often includes the full text of binding agreements to ensure the irrevocable nature of the bid is legally supported.

Principal Directors’ Duties

Duty of loyalty and confidentiality

The duty of loyalty is the central pillar. Directors must act in the best interests of the company and not for their own personal gain or that of a specific majority shareholder. In a merger or acquisition, this means, for example, that any director with an interest in the transaction (eg, linked to the acquirer) must declare it and abstain from voting on deliberations relating to the transaction, or that directors are bound to strict secrecy regarding sensitive information revealed during due diligence, so as not to harm the value of the target in the event of a breakdown in negotiations.

Duty to shareholders versus stakeholders

Primacy of the corporate interest (corporate interest)

Under OHADA law, directors must act primarily in the corporate interest of the legal entity. Although the interests of shareholders (value maximisation) are predominant, Senegalese case law and practice are increasingly incorporating a broader vision, particularly with regard to shareholders, who remain the main beneficiaries of directors’ duties, notably through the right to fair information and equal treatment, but also stakeholders.

Use of Special and Ad Hoc Committees

Although the OHADA Uniform Act allows for the creation of ad hoc committees, this remains rare in practice for private companies in Senegal. The management of conflicts of interest relies more on the legal procedure of “regulated agreements” (prior approval and voting without the interested party) than on the creation of specific governance structures, which are reserved for the most sophisticated or regulated entities.

In Senegalese law (OHADA), the concept of the “Business Judgment Rule” does not exist under this English name, but a similar principle of non-interference by judges in corporate management is applied by the courts.

Senegalese courts observe a principle of deference towards the strategic choices of the board of directors. The judge generally refuses to censor a decision on the grounds that it is economically “bad” or “inappropriate”. As long as the decision-making process complies with the law and the articles of association, the judge considers that he or she or they should not substitute for the directors in assessing the commercial appropriateness of a merger or takeover bid.

Lack of independent advice: in the vast majority of private transactions, the Board of Directors does not seek any independent outside advice. Directors rely solely on information provided by the majority shareholder or the company’s usual advisors (long-standing lawyer or accountant).

In Senegalese practice (OHADA), conflicts of interest are subject to strict legislative oversight, but effective judicial review remains limited to cases of post-acquisition disputes or crises between shareholders.

In the Senegalese jurisdiction (under the AMF-UMOA and OHADA frameworks), hostile tender offers are permitted by law, though they remain uncommon in practice.

The regulatory framework is designed to ensure that if a hostile bid occurs, it is conducted transparently, allowing the market and the target’s board to react appropriately. In addition, many listed companies in the region have highly concentrated shareholding structures, often with a dominant founding family, a strategic multinational partner, or the State. Taking control without the support of these principal shareholders is technically difficult.

Furthermore, corporate culture in the UEMOA zone tends to favour negotiated transactions. Most successful deals are “friendly” and preceded by extensive private discussions.

In the Senegalese jurisdiction (under the AMF-UMOA and OHADA frameworks), directors of a target company are allowed to use defensive measures, but their actions are subject to strict regulatory oversight and disclosure requirements to prevent the unfair frustration of a bid.

Board’s Right to Respond and Defence Agreements

The regulatory framework acknowledges that a target company may have pre-existing or reactive defensive strategies.

• Disclosure of defence agreements: The target company is specifically required to transmit to the AMF-UMOA any “defence agreements” (accords de défense) it has concluded with other partners.
• Motivated opinion: Within 15 days of being notified of an offer, the Board of Directors must provide the regulator with a report containing its motivated opinion on the offer’s merits.

Constraints on Director Actions

While defences are permitted, the law limits the autonomy of directors once an offer is in progress to protect shareholder interests, as follows.

• Extraordinary management acts: The Board of Directors must explicitly inform the regulator of any decision to perform acts “other than ordinary course management” (autres que de gestion courante). This allows the regulator to monitor the implementation of “poison pills” or the disposal of “crown jewels”.
• Prohibited manoeuvres: Any action or issuance of securities intended to impede the regular functioning of the market without prior regulatory approval (visa) is deemed a fraudulent manoeuvre.

Directors’ Duties in Takeover Defences (Senegal/UEMOA)

Under the AMF-UMOA General Regulations, the directors of the target company are subject to strict duties in order to ensure market transparency and integrity.

• Transparency obligation: Directors must notify the regulator of any “defence agreement” entered into with partners within 15 days of notification of the offer.
• Duty to provide information (reasoned opinion): The Board of Directors is required to provide a “reasoned opinion” on the merits of the offer and its consequences for the company and its shareholders.
• Limitation of powers (day-to-day management): During the offer period, directors must inform the regulator of any decision to carry out “acts other than day-to-day management”, thereby limiting their ability to unilaterally frustrate the offer.
• Responsibility and loyalty: Directors must act with loyalty and fairness in the interests of investors. Any defence measure that is not targeted or transparent is classified as a “manoeuvre intended to impede the regular functioning of the market”.
• Insider trading prohibition: From the earliest stages of a proposed bid, directors are prohibited from trading in securities if they possess confidential information, under penalty of being sanctioned for “fraudulent acts or manoeuvres”.

Directors in Senegal do not have the ability to “just say no” to a proposed business combination. Their powers are framed by OHADA company law and, where applicable, by the company’s articles of association.

While directors may influence the outcome of a transaction through recommendations, negotiations or the exploration of alternative proposals, the ultimate decision typically rests with the shareholders, particularly in transactions involving a transfer of control or significant corporate restructuring.

Any defensive measures adopted by directors must comply with their fiduciary duties, the company’s corporate governance framework and, in the case of listed companies, applicable market transparency rules.

Frequency and Common Drivers

Litigation is frequent in our experience in connection with M&A transactions in Senegal.

While parties prioritise amicable settlements, disputes often arise during two main phases, as follows.

• Post-closing claims: These are the most common, and typically involve the enforcement of warranties and indemnities (W&I). Buyers frequently initiate proceedings following the discovery of undisclosed tax, social, or other liabilities.
• Price adjustments: Disputes regarding earn-outs or the finalisation of completion accounts are recurring, often requiring the appointment of an independent expert to resolve valuation gaps.

Lessons From COVID-19 and Drafting Trends

Evolution of MAE/MAC clauses

Before 2020, material adverse change (MAE/MAC) clauses were often generic. The main lesson learned is the need to explicitly exclude or include health crises. In 2026, the trend is toward “tailor-made” clauses.

• Specific exclusions: Sellers now require that pandemics, epidemics, and related administrative measures be expressly excluded from the definition of MAE, unless they affect the target disproportionately compared to other players in the same sector.
• Quantitative thresholds: To limit the discretion of the judge, the parties are increasingly setting numerical thresholds (eg, a decline of more than 20% in revenue or EBITDA over six months) to characterise the materiality of the change.

Shareholder Activism

Importance and context

Shareholder activism is not an important force in Senegal. The corporate landscape is characterised by highly concentrated ownership, where the State, large multinationals, or founding families typically hold controlling blocks. This structure leaves little room for minority shareholders or “activist funds” to influence strategic decisions or board compositions through public campaigns, which are virtually non-existent in the jurisdiction.

Absence of Strategic Activism

In Senegal, activism does not typically target corporate structure or M&A strategy. Unlike in more developed financial markets, there are no “activist funds” or minority groups that pressure boards to enter into business combinations, divest non-core assets, or carry out spin-offs to “unlock value”.

Interference in Transactions

Limited interference by shareholders

In Senegal, it is very rare for activists or minority shareholders to interfere in the completion of an announced transaction (with the exception of their pre-emptive rights). Due to the high level of confidentiality surrounding private M&A transactions, the public and minor stakeholders are often only informed once the transaction has reached an advanced stage or has already been completed, leaving little room for external interference.

Emphasis on employee protection

The main “activism” observed during corporate consolidations comes from employees and unions. Their main concern is the preservation of jobs and the maintenance of acquired benefits. However, this rarely leads to the blocking of a transaction for the following reasons.

• Legal continuity: The Senegalese Labor Code provides for the automatic transfer of employment contracts to the new employer in the event of a merger or sale.
• Social dialogue: Potential issues are generally managed through internal social dialogue rather than through public or judicial interference in the conclusion of the agreement.

Overall, once a transaction is announced, the risk of third-party interference hindering its conclusion is considered negligible in Senegalese jurisdiction.