Energy & Infrastructure M&A 2025 Comparisons

The energy and infrastructure M&A market is still experiencing a slowdown that follows the general trend in M&A. Lower energy prices have resulted in energy assets being less attractive even if interest rates have stabilised. On the other hand, a surge in energy-intense infrastructure, such as data centres, is poised to lead to a gradual market recovery. Further development of energy technologies and energy services is also expected to have a positive effect on the market.

Over the past year, Finland’s energy and infrastructure sector has seen a shift driven by regulatory reform and the green transition agenda. Legislative initiatives have focused on accelerating permitting processes for renewables and implementing – eg, the new Offshore Wind Power Act (937/2024, as amended) and updates to the Building Act (751/2023, as amended) (see 6.1 Significant Court Decisions or Legal Developments).

In Finland, investors are accessing the energy and infrastructure M&A market through a mix of strategic acquisitions, continuation vehicles, and minority investments. Finnish law permits flexible structuring of such deals, including share and asset purchases, joint ventures, and private equity-backed transactions. Regulatory oversight is handled by, for example, the Finnish Competition and Consumer Authority (FCCA) and sector-specific regulators, with foreign investment screening applicable in sensitive sectors.

Key investor types include private equity funds, strategic corporates, and governmental and municipal investors.

Finnish law supports efficient deal execution with clear frameworks for due diligence, director duties, and foreign direct investment review. Labour rights, environmental and regulatory compliance, finance and real estate are key diligence areas in infrastructure transactions.

The current pipeline of major energy and infrastructure projects is heavily weighted toward renewables. Finland has published planned onshore wind power projects exceeding 60,800 megawatts (MW) and offshore projects exceeding 45,800 MW. Wind energy also supports the rapidly growing data centre sector. Conventional energy is mainly limited to nuclear, with small modular reactors (SMRs) under consideration. No new fossil fuel power plants are planned.

Finland is also investing heavily in the hydrogen economy, aiming for a 10% share of the EU’s clean hydrogen production and at least the same share in hydrogen utilisation. Over 40 hydrogen projects are in development.

In transport infrastructure, two major rail projects are in advanced planning. The Helsinki–Turku high-speed rail will improve regional connectivity, while the Lentorata underground rail link will link Helsinki Airport directly to the national rail network.

Significant data centre investments are currently being made in Finland, with a total value of several billion euros, as demonstrated by projects from Microsoft and Google. These investments bring employment and economic potential through, for example, the utilisation of waste heat and stabilisation of the electricity grid. According to statistics of the Confederation of Finnish Industries, the already confirmed investments exceed EUR12 billion.

The incorporation of a Finnish limited liability company is a fairly straightforward procedure. The registration of the Finnish limited liability company with the Finnish Trade Register can take anything from a day (a minimum requirement company) to a couple of months, depending on the complexity of the articles of association, composition of the board of directors, etc. Finnish limited liability companies do not have any minimum share capital requirements.

A trade sale or initial public offering forms the most common liquidity events. Typically transactions are structured as share deals where all outstanding shares are transferred to the buyer against cash, but also share consideration is used. Investors typically seek a full exit from the target.

Spin-offs usually occur where a company wants to streamline its structure or business or where a certain asset is carved out of a company structure.

It is possible to structure spin-offs so that the transaction is essentially tax-free. This can be achieved by a demerger or transfer of business if certain criteria are met, and the transaction may include only a limited cash consideration in addition to the share consideration. A VAT-exempt transfer of a business against cash consideration requires that the business subject to VAT is continued by the purchaser post-closing.

Different types of restructurings with several transactions and different types of corporate manoeuvres are possible and may not lead to adverse tax consequences.

A business transfer is not subject to any particular timing requirements. A demerger usually takes some six months due to the statutory period for public summons to creditors concerning the demerger. A ruling from the tax authorities is not required but may, depending on the circumstances, be advisable. It takes some two to three months to obtain such ruling.

It is not particularly common or considered market practice to acquire a stake in a Finnish public company before making an offer.

Any holdings in a publicly listed company that reach, exceed or fall below 5%, 10%, 15%, 20%, 25%, 30%, 50%, ⅔ and 90% of the voting rights or shares in the company must be notified to the Financial Supervisory Authority (FIN-FSA) no later than the trading day following the day the shareholder has learned or should have learned of the transaction. Holdings by any affiliated companies or a person acting in concert with the shareholder are taken into account in the calculations towards said thresholds. Within a group of companies all shares and voting rights held by the group in aggregate are calculated towards the said thresholds and it is the highest body exercising control within the entire group that is liable for the notifications.

Disclosure of Intentions and Plans

There are no specific requirements for disclosure of intentions or plans before a public takeover. However, the Helsinki Takeover Code 2022 does include certain disclosure obligations related to the bid process, with an emphasis on transparency and timely disclosure throughout the whole takeover process.

Once the public takeover process is commenced, any intentions or plans in relation to the bid process must be disclosed if such information is likely to influence the assessment of the takeover bid by the target company, holders of the target company’s securities or other investors.

Time Period for Buyer to Confirm or Decline Proposal

A person who has approached the target company or its shareholders concerning a potential takeover bid or has announced such plans must, within a time period set by the FIN-FSA, either (i) announce publicly a takeover bid; or (ii) publicly confirm that a takeover bid will not be pursued, if the target company’s board has requested the FIN-FSA to set such deadline. The prerequisites for the FIN-FSA to set such deadline is that information concerning the potential of a takeover bid is likely to disrupt the normal functioning of the securities markets or interfere with the target company’s business operations for an unreasonable amount of time.

If the takeover bid is not disclosed or confirmation that no takeover bid will be pursued is disclosed by the deadline set by the FIN-FSA, the relevant person cannot launch a takeover bid for a period of six months following the deadline.

If a shareholder’s voting rights in a company listed on a regulated market or a multilateral trading facility exceed 30% or 50% of the total voting rights of the target company, said shareholder is obligated to make a public offer for all shares in the target company. In addition, if a shareholder’s shareholding in the target company exceeds 90% of all outstanding shares and votes, such shareholder has the right to redeem the rest of the shares in the target company and is obligated to do so upon a request by the minority shareholders.

A public company is typically acquired through a public takeover or merger.

Mergers are, perhaps, more commonly used in acquisitions of public companies than public takeovers. In recent years, it has become quite common in Finland for a public company to be acquired by means of a merger. The merger process is quite strictly regulated in the Finnish Companies Act (624/2006, as amended), providing for certain measures with the intent of protecting minority shareholders and creditors. A merger must be approved by the general meeting of shareholders of the merging company by a 2/3 majority of the votes cast and of the shares represented at the meeting as well as of each share class represented at the meeting. Depending on the circumstances, the merger must be resolved upon by either the shareholders’ meeting or the board of directors of the receiving company.

Public Tender Offers

The consideration in a mandatory takeover bid must be an equitable price, consisting of cash, securities or both. When determining what an equitable price would be, the highest price paid by the offeror during the six months preceding the obligation to launch a bid (refer to 4.2 Mandatory Offer) is used as the basis for the determination. If no securities have been acquired by the offeror during said period, the average of the prices paid for the securities in trading weighted by the volume of the trade during the three months preceding the obligation to launch a bid shall be used as a basis in the determination.

The consideration in a voluntary bid may also consist of cash, securities or both, except for in certain situations where a cash component must be offered, typically where the securities offered as consideration are not traded in a public marketplace. The basis for the determination of the consideration shall be the highest price paid by the offeror during the six months preceding the announcement of the takeover bid.

In Finland, the consideration has usually been paid in cash.

Mergers

The merger consideration is usually paid in shares despite the Finnish Companies Act also allowing cash, assets or other commitments as consideration.

The merger consideration is agreed upon between the merging parties in the merger plan.

Typical conditions in Finnish tender offers are as follows:

• A minimum acceptance rate (often above 90%) has been reached.
• The relevant regulatory approvals have been obtained.
• No material adverse change has occurred after the announcement.
• No authority or court decisions have been given and no other legislation has been issued that would prevent, postpone or frustrate the completion of the tender offer.
• The board of directors of the target company has issued its recommendation to the shareholders to accept the offer and the recommendation remains valid.
• The combination agreement entered into by the offeror and the target has not been terminated.

According to the guidelines of the FIN-FSA, the offeror shall not invoke a condition to the completion of a tender offer unless the non-fulfilment of such condition has a material impact for the offeror in view of the tender offer, as such action by the offeror would frustrate or materially impede the implementation of the tender offer.

An agreement is usually entered into in connection with a public takeover. Typical terms are undertakings concerning the conduct of business and customary representations and warranties, for example:

• undertaking to inform the offeror of any possible competing offers;
• undertaking to provide the offeror with an opportunity to improve their offer terms, including the offer price, in case of a superior competing offer (matching right);
• undertaking to reimburse the offeror for certain documented expenses and costs following a termination of the combination agreement under certain circumstances (break fee); and
• non-solicitation undertaking regarding any competing offers.

A combination agreement is typically entered into in connection with a merger.

Typically, a minimum acceptance condition of an acceptance exceeding 90% is required in public tender offers. This is due to the fact that, under the Finnish Companies Act, once a shareholder has a holding exceeding 90% of the shares and votes, such shareholder has the right and obligation to redeem all outstanding shares.

There have been cases where tender offers have been lower than 90% due to weak preliminary results or competing bids.

Once a shareholder has a holding exceeding 90% of the shares and votes, such shareholder has the right to redeem all outstanding shares. Conversely, a minority shareholder has a right to demand that the majority shareholder redeem their shares.

The redeeming majority shareholder shall notify the company of the commencement and termination of redemption proceedings and the company shall notify the Finnish Trade Register of the same.

If the offeror intends to reach the 90% threshold in connection with a public tender offer, the potential intention to demand a squeeze-out of minority shares must be disclosed in the offer documents. Once the offeror acquires more than 90% of the shares and voting rights in the target company, it must initiate the squeeze-out process without undue delay.

The process is technical and time-consuming, involving several legal and administrative steps, including formal notifications, documentation, and communication with minority shareholders. In most cases, the redemption price determination is handled through a statutory arbitration procedure under the Finnish Companies Act.

The offeror must, before launching its tender offer, ensure it can deliver the promised consideration. For cash offers, this means having sufficient funds available or entering into financing agreements that provide a high degree of certainty – ie, the lender shall not be allowed to withdraw unilaterally. However, the offeror does not need to hold the funds at launch; financing arrangements may be conditional on the offer being completed according to its terms.

A voluntary tender offer may include a condition relating to financing availability up until completion. By contrast, a mandatory tender offer can only be conditional on obtaining required regulatory approvals and cannot depend on financing.

Break fees, matching rights and non-solicitation provisions are commonly used. See 4.6 Deal Documentation for further information.

In Finland, tender offers typically include a minimum acceptance condition of more than 90% ownership, as this threshold grants the bidder the statutory right to initiate compulsory redemption proceedings and acquire all remaining shares and votes (see 4.7 Minimum Acceptance Conditions).

If the bidder cannot reach 100% ownership through the tender offer process, governance rights depend on the size of the stake acquired:

• With at least 50% of the votes and shares, the bidder can generally control ordinary resolutions at the general meeting, including the election of the board of directors.
• With two-thirds of the votes and shares represented, the bidder gains broader powers, such as approving amendments to the articles of association, authorising directed share issues, and, in certain cases, approving mergers or demergers.

Domination or profit-sharing agreements similar to those in some jurisdictions are not typical. Instead, governance influence is exercised through shareholding thresholds and voting rights. Minority protections under the Finnish Companies Act remain in place, so bidders should anticipate limitations on actions that require unanimity or special majority beyond two-thirds.

In order for a tender to be successful, obtaining irrevocable commitments from the principal shareholders of the target company may be conclusive and, thus, it is common to aim to ensure the involvement of the principal shareholders in the tender. Negotiations with shareholders are made before public disclosure of the offer. It should be noted that such shareholders will subsequently usually become subject to regulations on insider trading. The undertakings are usually conditional in that they provide an out for the shareholder if a better competitive offer is made, by reserving the shareholder’s right to attend to the competitive offer instead.

Before the offer period begins, the offeror must publish and make available to the public an offer document containing all relevant information about the bid. This document can only be released after approval by the FIN-FSA. The FIN-FSA has five business days from receipt of the document to decide whether it can be published or if amendments are required.

The FIN-FSA will approve the offer document if it provides sufficient and essential information on the bid for shareholders to make an informed decision. The FIN-FSA does not typically review or approve the offer price or commercial terms, provided they are lawful and do not breach shareholder equality. If a consortium makes the tender offer, it needs to have preliminary discussions with FIN-FSA to enable it to review the consortium structure and offer terms in detail.

The statutory offer period must be, in general, at least three weeks and no more than ten weeks. Extensions beyond ten weeks are permitted in certain circumstances, such as pending regulatory approvals or the announcement of a competing offer, provided the target’s day-to-day operations are not disrupted for an unreasonable period of time.

Under Finnish takeover rules, the offer period during which target shareholders may accept the bid must generally last at least three weeks and no more than ten weeks (refer to 4.13 Securities Regulator’s or Stock Exchange Process).

According to FIN-FSA guidance, if completion of the bid depends on regulatory approval, such as merger control clearance, the offeror must extend the offer period until the authority has issued its decision and the offeror has had time to evaluate any conditions imposed. The extension may be structured either as continuing “until further notice” or ending on a specified date, which must be at least two weeks after the extension announcement.

FIN-FSA also recommends that the offeror commence the bid procedure within a reasonable time after announcing the takeover bid, typically within one month for voluntary cash bids. In practice, parties usually begin preparing regulatory filings immediately after the announcement, but approvals are rarely obtained before the bid is launched due to timing constraints.

A privately held company is typically acquired by entering into either a share purchase or an asset purchase agreement, with share purchases being used more often. Share deals are generally preferred because they allow the buyer to acquire the entire business, including contracts, licenses, and goodwill, without the need for individual asset transfers.

Buyers may also participate in auction processes arranged by or for the sellers. Auction processes are more common when the seller has engaged an M&A adviser and the target is likely to attract several purchase candidates.

Key considerations for buyers include thorough due diligence as well as negotiating warranties and indemnities to mitigate risks. In asset deals, buyers must pay close attention to transfer requirements for permits, real estate, and employees. Foreign buyers should also consider whether the transaction triggers foreign investment screening or real estate permit requirements.

Generally, establishing a new company in Finland’s energy and infrastructure sector is not subject to special rules or regulations. However, certain activities require sector-specific permits or licences, several of which are described below.

Electricity and Natural Gas Networks

Operating grid networks in Finland requires a licence from the Finnish Energy Authority. The permitting process typically takes several months.

Nuclear Power Operations

Nuclear projects require multiple permits from, for example, the government of Finland and the Finnish Safety and Chemicals Agency (Tukes). These processes are extensive and can take several years. Notably, legislative reforms are underway to enable construction of small modular reactors (SMRs) with streamlined permitting.

Offshore Wind Development

Offshore wind projects in Finland’s exclusive economic zone require an exploitation permit granted through an auction process managed by the Finnish Energy Authority.

Beyond sector-specific permits, developers must comply with environmental impact assessment (EIA) requirements and land use planning regulations. Timelines vary significantly: while grid licences may be secured in months, nuclear approvals can span several years due to safety and environmental reviews.

The FIN-FSA is the primary securities market regulator for M&A transactions in Finland. It oversees compliance with the Securities Markets Act (746/2012, as amended) (SMA), including provisions governing takeover bids, and is responsible for approving the offer document (refer to 4.13 Securities Regulator’s or Stock Exchange Process) and, in the case of statutory mergers, reviewing and approving the merger prospectus, which must be made available to shareholders before the general meeting that decides on the merger.

Finland operates a foreign investment screening mechanism that enables the Finnish government to monitor and, where necessary to protect essential national interests, restrict or block acquisitions by foreign investors in certain monitored sectors.

Under the Act on the Screening of Foreign Corporate Acquisitions (172/2012, as amended), a foreign buyer must apply for prior approval from the Ministry of Economic Affairs and Employment (MEAE) for an acquisition that would result in it holding at least one-tenth, one-third or one-half of the voting rights (or corresponding actual influence) of a Finnish defence sector (including dual-use) or security sector company. In addition, a foreign buyer may submit a notification to the MEAE for an acquisition resulting in the buyer holding at least one-tenth, one-third, or one-half of the voting rights (or corresponding actual influence) of a company or business holding a key position with respect to maintaining vital functions of Finnish society.

A “foreign buyer” is defined as (i) a person, organisation or foundation not domiciled in an EU or EFTA (European Free Trade Association) member state; or (ii) any organisation or foundation domiciled within an EU or EFTA member state in which a foreigner or entity referred to in (i) holds at least one-tenth of the voting rights in the case of a limited liability company, or corresponding actual influence in the case of another entity or business. In the case of Finnish defence companies, the definition of a foreign buyer also includes entities domiciled in an EU or EFTA member state (other than Finland).

The MEAE approves acquisitions resulting in the control of these companies, unless the acquisition endangers key national interests, in which case, the matter is referred for consideration to the Council of State. The Council of State may either approve the acquisition or, if necessary due to a key national interest, refuse to approve it. Such interests include:

• military national defence;
• national security and public order; and
• functions vital to society (including safeguarding critical infrastructure and security of supply).

The MEAE may impose conditions on an acquisition if it is necessary to secure key national interests. The conditions must be accepted by the parties to the acquisition. If approval is not granted, the buyer must decrease its ownership to less than one-tenth (or less than one-third or one-half) of the shares in the company, and can only exercise the corresponding voting rights at a general meeting of the company’s shareholders or other relevant corporate body.

In addition, foreign real estate acquisitions are subject to a separate permit procedure under the Act on Real Estate Transfers Requiring Special Permission (470/2019, as amended). A permit from the Ministry of Defence is required before purchasing real estate if the buyer is:

• a private individual without EU or EEA nationality;
• a company or entity domiciled outside the EU or EEA; or
• a company or entity domiciled in the EU or EEA in which a non-EU/EEA individual or entity holds at least 10% of the votes or equivalent actual influence.

Finland conducts national security reviews of certain acquisitions under the Act on Monitoring Foreign Corporate Acquisitions (refer to 5.3 Restrictions on Foreign Investments), where the Ministry of Economic Affairs and Employment may review transactions involving defence-related businesses or critical infrastructure and, if necessary to protect essential national interests, impose conditions or block the deal.

Export control regulations are well established. The Ministry of Foreign Affairs oversees export controls for dual-use items and technology under statutory supervision under the Act on the Export of Dual-Use Items (500/2024, as amended) and Regulation (EU) 2021/821. Exports of dual-use goods outside the EU require prior authorisation, and extremely sensitive items, such as nuclear materials, require authorisation even for intra-EU transfers.

The Ministry of Defence regulates defence materiel exports under the Act on the Export of Defence Materiel (282/2012, as amended). A licence is mandatory for exporting, transferring, transiting, or brokering defence materiel. Each application is assessed individually, and approval depends on alignment with Finland’s foreign and security policy and assurance that national security is not compromised.

The National Police Board oversees export controls on civilian firearms and ammunition.

For energy and infrastructure M&A, buyers should consider whether the target operates in sectors deemed critical for national security (eg, electricity grids, nuclear facilities). Transactions involving such assets may require prior consultation with authorities. Export control compliance is particularly relevant for companies engaged in technology development, nuclear energy, or defence-related infrastructure.

The key regulator with respect to merger control is the Finnish Competition and Consumer Authority (FCCA). M&A transactions are subject to merger control under the Competition Act (948/2011, as amended). An M&A transaction, or a concentration for the purposes of the Competition Act, is subject to control and needs to be notified to the FCCA prior to implementation if both the combined turnover of the parties to the concentration generated in Finland exceeds EUR100 million and the turnover generated in Finland of each of at least two parties to the concentration exceeds EUR10 million.

If the EU merger control thresholds are met, the transaction must be notified to the European Commission, which has exclusive jurisdiction to review concentrations with an EU dimension, regardless of whether Finnish national thresholds are also triggered.

Finland does not have works councils established by law or collective agreements. However, all employers with at least 20 employees fall under the scope of the Co-operation Act (1333/2021, as amended) which aims to promote dialogue between employers and employees. The Act imposes mandatory information and consultation obligations, requiring continuous dialogue on matters such as the company’s financial position, workplace practices, personnel needs, and employee well-being. Failure to comply with consultation obligations can lead to administrative sanctions and reputational risk. Acquirers should also consider collective bargaining agreements, which may impose additional consultation requirements.

Prior to implementing significant decisions, such as workforce reductions, employers employing at least 50 employees in Finland as well as smaller enterprises planning reductions of workforce potentially affecting 20 or more employees must conduct formal negotiations with employees or their representatives. These negotiations have strict requirements regarding process, timing, and duration. Employees are typically represented by a shop steward or elected representative; if none exist, all affected employees participate. Importantly, no decisions (including those by a foreign parent company) may be made, nor any (direct or even indirect) actions implying a decision taken, until negotiations are completed. Once the consultation obligation is fulfilled, the employer may proceed regardless of employee opinion.

The Co-operation Act also provides for employee representation in company administration. Employers with at least 150 employees must allow employees to request representation in administrative bodies that address significant business, financial, and personnel matters. Representation is primarily agreed between the employer and employees; if no agreement is reached, employees may appoint representatives to the board of directors or equivalent management bodies covering all business units.

M&A transactions are not subject to currency control regulation nor do they require approval from the central bank.

Court precedents are limited since M&A disputes in Finland are generally resolved through arbitration. The most notable recent legal developments affecting energy and infrastructure M&A have therefore been legislative rather than judicial, and have come through legislative reforms aimed at improving permitting and land use planning, facilitating green transition, and supporting, for example, offshore wind power and small modular reactors (SMRs).

The updated Building Act, effective January 2025, introduces a new siting permit to streamline land use planning for energy infrastructure. The siting permit would allow bypassing land use planning in industrial clean energy transition projects as long as the requirements provided for the siting permit are met. At best, the possibility to bypass land use planning will likely speed up project development significantly. Permits could be applied for hydrogen or battery factories but not for wind or solar power plants. Finland is also implementing a one-stop shop permitting model to simplify administrative processes.

The Offshore Wind Act, effective January 2025, establishes a framework for the competitive selection of developers and clarifies the permitting process for offshore wind projects in Finland’s Exclusive Economic Zone. The Act aims to ensure a transparent and predictable process, providing legal clarity for investors.

From a political and regulatory perspective, Finland’s climate objectives enjoy broad support, with successive governments upholding the legally binding goal of achieving carbon neutrality by 2035. Government support for the energy transition includes the proposed Green Investment Tax Credit, which would offer up to 20% tax relief for large-scale climate-neutral investments. In addition, Finland provides smaller-scale energy subsidies, including support for, inter alia, biogas and advanced biofuels.

Conventional energy sources are increasingly viewed through the lens of system security and reliability as the country transitions toward a renewable energy system. Coal-fired energy will be banned from 2029. The key exception to this trend is nuclear power, which enjoys strong political backing. Finland is actively exploring the expansion of nuclear capacity, including the development of small modular reactors (SMRs), and is currently updating its legislation to better accommodate new nuclear technologies.

The Helsinki Takeover Code 2022 stipulates that if the target company’s board receives a serious takeover proposal that it considers to be in the shareholders’ interests, it should allow the offeror, upon request, to conduct a due diligence review. The scope of review must be determined on a case-by-case basis, and prior to commencing any review the parties are expected to enter into a confidentiality agreement.

Where the offeror and the target are competitors, competition law may restrict the type of information that can be shared. In such cases, sensitive data is often disclosed through clean team arrangements, limiting access to advisers or a small group of designated bidder representatives.

While the board has discretion over the level of due diligence, it should ensure equal treatment of bidders. If multiple serious bidders are involved, the board should generally provide comparable access to information. Furthermore, insider information rules under the EU Market Abuse Regulation should be considered when sharing any material non-public information.

There are no sector-specific restrictions that limit due diligence for energy and infrastructure companies. However, requirements under the EU General Data Protection Regulation (GDPR) and national privacy laws need to be observed as in any due diligence process (meaning, in practice, redacting personal data and disclosure restrictions relating to certain employee data).

For energy and infrastructure targets, bidders should also consider regulatory regimes governing critical infrastructure and energy markets. While these do not typically restrict due diligence, they may impose confidentiality obligations on certain operational data (eg, related to grid access, security protocols, or matters related to civil or national defence).

A voluntary takeover bid is entirely at the discretion of the offeror and is not triggered by any statutory shareholding thresholds. Once the offeror decides to proceed, the obligation to disclose the bid arises immediately. The offeror must disclose the decision without delay and notify the target company in accordance with the requirements of the SMA.

In contrast, a mandatory bid obligation occurs when a shareholder’s voting rights in a company listed on a regulated market or a multilateral trading facility at the initiative of the issuer exceed either 30% or 50% of the total voting rights of the target. Once this threshold is crossed, the party obliged to bid must promptly disclose the obligation to bid and publish the mandatory bid within one month. The takeover bid procedure must commence within one month of publication.

The offeror must, in addition to making the bid public, also publish and keep publicly available an offer document containing material and sufficient information for shareholders to assess the bid’s merits. The offer document can only be published following approval of the FIN-FSA. Disclosure of the bid must be carried out in a manner ensuring fast and non-discriminatory access to information, and the offeror’s decision to launch a bid must also be reported to the stock exchange.

For a stock-for-stock takeover bid or a merger-based business combination, a prospectus prepared in accordance with the EU Prospectus Regulation and its delegated acts is generally required.

In the case of a cash takeover bid, the offeror is instead required to prepare and make available to the public an offer document containing sufficient details for shareholders to evaluate the bid’s merits. This document must comply with the relevant provisions of the SMA.

The FIN-FSA must approve the prospectus or the offer document after which the bidder shall publish the document.

Pro forma financial information is generally required in prospectuses prepared for stock-for-stock takeover bids and merger-based business combinations. This information is typically presented using the same accounting standards applied by the target company in preparing its financial reports.

In contrast, the offer document for a cash takeover bid does not need to include pro forma financial information.

The combination agreement entered into in connection with a voluntary tender offer or a merger is generally not made public. However, in the case of a merger, the merger plan signed by the merging entities must be published when the merger is announced and filed with the Finnish Trade Register.

While the combination agreement remains confidential, certain key terms, such as consideration structure and timetable, are typically disclosed in the offer document or prospectus.

The board’s role in a business combination is assessed under the general principles of Finnish company law: management, including the board of directors, must act with due care and in the best interests of the company and its shareholders.

In practice, the management is expected to secure the most favourable outcome for shareholders in a merger or takeover bid. In merger negotiations, this typically means obtaining the most advantageous merger consideration; in a takeover bid, it involves taking all necessary steps to achieve the best possible offer, including evaluating strategic alternatives. To fulfil this duty, the board must gather adequate information for its assessment and determine whether external advisers should be engaged.

In a public takeover, the target company’s board must prepare and publish a statement on the bid, recommending acceptance or rejection. This statement often significantly influences the outcome of the offer (refer also to 9.4 Independent Outside Advice). In a merger, the boards of the merging entities must draft a merger plan, which is published and registered with the Trade Register. Additionally, the board is responsible for evaluating the terms of the combination agreement, which is standard in both voluntary public tender offers and mergers (refer also to 4.6 Deal Documentation).

Under Finnish law, directors’ duties are primarily owed to the company and its shareholders, rather than to all stakeholders. However, in practice, boards often consider broader stakeholder interests – such as employees, creditors, and regulatory compliance – because these factors can materially affect the company’s long-term value and legal risk.

In addition to its permanent committees, the board of directors may establish ad hoc committees to handle specific matters. These committees are commonly formed to prepare for significant business transactions or when certain directors face conflicts of interest. Importantly, such committees do not have independent decision-making authority, but their role is limited to assisting the board in preparing for decisions.

The board is required to exercise due care and act in the best interests of the company and its shareholders. Consequently, it is generally expected to play an active role in the M&A process. In practice, the chair and/or designated members of the board often participate directly in negotiations. For further details on the board’s broader responsibilities in business combinations, refer to 9.1 Principal Directors’ Duties.

It is common practice for the board of directors of a target company to engage an independent financial adviser to issue a fairness opinion that evaluates whether the proposed consideration is reasonable from a financial perspective. This opinion is typically disclosed alongside the formal announcement of the PTO or business combination.

The board of the target company is required to issue a public statement regarding the public takeover bid; however, it must not rely exclusively on the fairness opinion when preparing and substantiating this statement.