Technology M&A 2025 Comparisons

The rise of numerous new technologies has been at the forefront of developments in the Greek market, including as a key factor behind the increase in M&A transactions concerning technology companies. In line with global trends, the technology M&A market in Greece was characterised by a relative downturn in 2023. This was primarily attributed to factors such as macroeconomic events, inflation and high interest rates, while valuation gaps between sellers and buyers were stalling more than a few M&A workstreams.

Nevertheless, the early optimistic predictions for 2024 appear to have been fulfilled and the Greek technology M&A market has been witnessing a significant uptick in deal volume and value, with TMT transactions leading the deal flow pace for another year and AI opportunities being on the radar of strategic M&A players.

The market sentiment for the period ahead remains quite bullish and solidly based on the country’s ongoing economic stability, which led to Greece’s return to investment grade after 13 years. M&A activity has already benefited from these developments and is expected to continue to do so.

Technology and innovation have become key drivers of M&A activity in Greece in recent years. The transition to digitised business models – especially following the COVID-19 pandemic, the rapidly developing innovative tools accelerating M&A workstreams, and the increased pool of deal opportunities (whether as regards start-ups or global tech powerhouses) – are just some of the manifestations of this continuing trend. The Greek State keeps passing legislation and incentives to promote investments in start-ups and more “traditional” technology companies, as well as R&D and innovation in general. Newly introduced Greek Law 5162/2024 aims to further enhance the existing tax incentives for angel investors investing in Greek start-ups and Greek venture capital funds as well, while also introducing a new “start-up visa”.

Local venture capital and private equity funds are also making their presence felt in the Greek technology market, with investments ranging from fintech and software as a service (SaaS) to cybersecurity and medtech. In the same context, institutional investors are becoming increasingly sophisticated and are constantly on the lookout for opportunities for potential synergies with their existing portfolio companies.

The Greek start-up ecosystem has transcended the boundaries of the country in recent years, with Greek-founded start-up companies being incorporated in various countries with a view to gaining better access to capital and strategic insights. However, the pool of Greek-based start-up companies has also seen a significant increase in recent years, as the country is steadily becoming a more attractive and investor-friendly destination. Greece is making its case as an emerging innovation hub and entrepreneurs are now keener to start their companies in a jurisdiction that is rebuilding its kit of tools and incentives to promote tech and innovation.

Simplicity in incorporating a new company is also a step in this direction. Greek Law 4919/2022, as amended by Law 5122/2024 and currently in force, governs the “one-stop shop” (OSS) process for establishing any legal entities. Specifically, one can opt for a simplified OSS or electronic OSS (e-OSS) process. Private companies, which are the preferred start-up option (for further details, see 2.2 Type of Entity), are incorporated only electronically by the founder(s) or any authorised person through the e-OSS procedure using the model articles of association.

The establishment process usually takes three to five business days for OSS or one business day for e-OSS.

The most common forms available for start-ups under Greek corporate law are the private company (idiotiki kefalaiouhiki eteria) and the société anonyme/corporation (anonymi eteria). Out of the two, the private company is the go-to option for most start-ups, as it offers flexibility, cost-efficiency and does not require a minimum initial capital (capital in private companies is split in company parts). It also allows for different types of contributions – namely, capital contributions, non-capital contributions (eg, by the founders through the provision of services to the company) and guarantee contributions.

On the other hand, the société anonyme is in general considered more appropriate for larger enterprises and has a minimum share capital requirement of EUR25,000 that must be paid in cash or in kind. Within two months of establishing a société anonyme, the board of directors must certify that payment of the initial share capital payment has been made. Partial payment is not allowed for contributions in kind and for listed companies. Sociétés anonymes may be privately held or publicly traded.

Other types of corporate forms, such as partnerships and sole entrepreneurships, are not common in the Greek start-up ecosystem.

Early-stage financing for Greek start-ups typically ranges from friends and family to state subsidies and, more recently, to family offices or a combination of these. A significant increase in angel investor activity has also been witnessed during the past few years.

Venture capitalists tend to lead seed-funding rounds; this refers to both domestic and international funds, which are usually involved at a more mature financing stage (Series A onwards). On the other hand, crowdfunding has been less popular with Greek entrepreneurs, who seem to be more sceptical about the use of such platforms.

Depending on the type of financing, the nature of the investors and their relationship with the start-up, an investment or equivalent agreement could be put in place. Such agreement may also include certain provisions resembling features of a shareholders’ agreement, such as specific corporate decisions requiring the prior consent of the investor or investor majority, as well as corporate governance matters and increased information rights.

Venture capital in Greece is typically provided by venture capital funds, both domestic and foreign, and has now become easily accessible to Greek start-ups. During the past five to six years, the country managed to establish a solid start-up funding infrastructure. EquiFund and JEREMIE stood behind the first Greek venture capital funds, leading to numerous considerable funding rounds and exits, while also nurturing the first Greek unicorns (eg, Viva Wallet). The EquiFund era is now over, but its impact on the country’s funding ecosystem remains clear to notice. The torch has now been passed to the Hellenic Development Bank of Investments, which is fully embracing the role of the main Greek sovereign anchor investor and is expanding its fund portfolio, which currently comprises 29 venture capital/private equity funds, with the number being expected to increase in early 2025.

International venture capital firms have been also very active in the Greek market (mostly in more mature financing rounds). Such venture capital firms primarily originate from the Balkan region, as well as other European countries with robust venture capital cultures.

In Greece, there is currently no industry body that develops standards for venture capital documentation akin to the British Private Equity and Venture Capital Association (BVCA) in the UK. Nevertheless, the majority of venture capital transactions involving Greek start-ups are concluded on the basis of documentation following a similar pattern. In addition, some of the Greek venture capital funds previously supported by EquiFund (for further details, see 2.4 Venture Capital) have developed their own template documentation, which is publicly available and can be used as a reference.

Most start-ups are incorporated in the form of private companies. At later stages of the companies’ life cycle, founders frequently contemplate transforming their companies into sociétés anonymes. This is often also mandated by institutional investors and their investment horizon as regards the respective companies.

The société anonyme constitutes the most appropriate vehicle available in most regulatory frameworks, public procurement procedures and investment incentives laws (subject to certain capital adjustments, as the case may be). It is the only vehicle that offers the option of being listed on a stock exchange and allows companies to receive financing through the issuance of bond loans (which is followed by a favourable tax treatment).

A change of jurisdiction is not very common for Greek start-ups; however, depending on the specific needs and targets set by founders together with any existing investors, the creation of holding entities abroad may be contemplated for tax optimisation purposes. The establishment of branches in other jurisdictions is also frequently used for the development of activities and co-operation with foreign partners.

The exit environment for Greek start-ups has been quite dynamic recently, with private sales being the preferred exit route in most cases. IPOs are deemed suitable for more mature companies and are expected to become more common, as the Greek market evolves as well. On the other hand, dual-track processes are fairly uncommon – although sophisticated investors could explore such an option in the pursuit of maximum flexibility.

In general, Greek companies opting for a listing usually choose the Athens Stock Exchange, rather than a foreign exchange. A combination of both options is also feasible, but is inevitably more complex to attain.

Listing of start-ups has not been a common theme in the Greek market up until now. Nevertheless, the country’s increasing financial stability together with recent innovation programmes put in place by the Athens Stock Exchange could potentially lead to more listings in the foreseeable future, particularly on EN.A (enallaktiki agora) – an alternative market of the Athens Stock Exchange, aimed at SMEs and early-stage business development companies.

Listing of a company on a foreign exchange should not be expected to have an impact on the feasibility of a future sale, other than having to comply with any specific regulations of that stock exchange and navigating any complexities arising from coping with multiple jurisdictions.

In the case of a liquidity event in the form of a sale of the company, the sale process can be conducted either through bilateral negotiations with an identified buyer or as an auction. In Greece, bilateral processes are typically the norm but, depending on the type of entity to be sold and the interest that key stakeholders may wish to attract, there have also been several auctions – particularly as regards business sectors/segments that have been put up for sale, as vendors are increasingly keen to consolidate business activities. However, auctions are not suitable for all companies, as they involve extended timelines (compared to a bilateral negotiation) and additional costs.

A sale of a privately held Greek technology company with multiple venture capital investors is usually structured as a sale of the entire share capital of such company. Less frequently, there have been “staggered” deal structures, whereby a majority stake is sold at first followed by a combination of call/put options for the remainder of the shares (owned by founders and/or venture capitals). These structures are often linked with earn-outs for the founders, as a way of incentivising them as long as they keep running the company.

Venture capital investors opt to safeguard their exit rights in case of liquidity events by means of co-sale rights. These include tag-along rights or – depending on the investors’ negotiating power and the amounts invested in the company – even drag-along rights (which, in cases of multiple venture capital funds, are usually triggered by the decision of an investor majority).

The majority of transactions in Greece in the form of a sale of the entire company are performed on the basis of cash consideration, whereas stock-for-stock transactions are very scarce. Deals involving tech companies usually include a combination of cash and stock consideration, either upfront or as part of a Management Incentive Plan (MIP), depending on the particularities of each deal and the strategic plans for the acquired entity (eg, whether it will continue as a standalone business or be absorbed by the acquiring group).

The stock component of the consideration is heavily negotiated by the founders, who are the main recipients of such stock together with any other key executives or employees. On the other hand, venture capitalists are generally less keen to acquire stock as part of a secondary sale.

In a sale of a company, all selling shareholders – including founders and venture capital investors – are requested to provide representations and warranties regarding title to shares and non-encumbrance thereof, as well as capacity to enter into the respective transactional documentation. The remaining so-called business warranties are then expected to be provided by the founders and/or any other key selling stakeholder involved in the company’s management/operation.

The extent of the business warranties – as well as any specific indemnities addressing “red flags” identified during the buyer’s due diligence – are the focal point of negotiation between the two sides, along with any limitations of liability of the parties standing behind the warranties for potential breaches thereof. By way of example, tax matters are frequently addressed through an indemnity (especially as regards companies with many years of operation), given that the Greek tax regime is quite complex and the potential exposure may be significant.

Mechanics for gradual release of the purchase price, such as an escrow/holdback, are also frequently used as a means of risk allocation between the parties. Right before the COVID-19 outbreak, an upsurge in warranty and indemnity (W&I) insurance policies was also noticed. After a relative downturn, we are now seeing contracting parties opting for W&I insurance more frequently – although these are usually in cases of larger transactions, provided the agreed transaction timeline permits it.

There is a clear trend towards consolidation of business activities and Greek companies are now focusing on their core operations. This, in turn, has led to more spin-offs, particularly in the case of larger corporate groups with multiple operations.

Spin-offs are now being utilised as a means of unlocking value, as well as attracting investor interest, and there have been quite a few M&A transactions in the past couple of years (especially auctions) in which the spin-off of a non-core business was either performed at a preliminary stage of the transaction (or even at the structuring phase) or designated as a condition precedent for the completion of the transaction.

Structuring a spin-off as a tax-free transaction is feasible in Greece. Greek tax legislation provides various regimes for implementing a tax-neutral spin-off in compliance with the respective tax incentives laws, such as Legislative Decree 1297/1972, Greek Law 2166/1993 and Greek Law 4172/2013 (the “Greek Income Tax Code”).

Spin-offs followed by business combinations are possible and rather frequent in the Greek market, whether as part of a multi-tiered corporate restructuring or in the context of M&A transactions. Depending on the type of business combination, the parties need to be mindful of and comply with any applicable law requirements, such as the provisions of Greek Law 4601/2019 on corporate transformations.

A typical timeframe for the completion of a spin-off would be three to four months, including a statutory 30-day “cool-off” period for the protection of creditors of the company proceeding with such spin-off.

There is no requirement to obtain a ruling from a tax authority. To the extent that any tax incentives law has been applied, the proper application thereof and compliance with any related requirements may be checked by local tax authorities as part of a future tax audit.

It is possible to acquire a stake in a public company in Greece prior to making an offer and there have been many instances in which buyers have utilised this option. In this regard, such acquisitions are sometimes viewed as advantageous in terms of preparatory work that needs to be done, familiarisation with the relevant business and other stakeholders, etc.

Pursuant to Greek Law 3556/2007 (the “Greek Transparency Law”), a reporting obligation to the issuer within three trading days is triggered when any person reaches, exceeds or falls below 5%, 10%, 15%, 20%, 25%, 33.33%, 50% and 66.66% of the total percentage of voting rights in a public company. The same obligation applies where a person holding more than 10% of the voting rights experiences an increase or a decrease of such percentage equal to or more than 3% of the issuer’s total voting rights. In both of those instances, the calculation of the relevant thresholds shall take into account voting rights held both directly and indirectly. The relevant notification is then submitted to the Hellenic Capital Market Commission (HCMC) as well.

In accordance with Greek Law 3461/2006, any person intending to submit a public bid (whether voluntary or mandatory) has to notify the HCMC and the board of directors of the target company in writing in advance. In public bids, the offeror is required to publish an information memorandum (following approval thereof by the HCMC), which must – inter alia – set out the offeror’s intentions regarding the continuation of the business activities of the offeree company and the offeror’s company, as well as the offeror’s strategic plans for the two companies.

Greek Law 3461/2006 provides for a mandatory offer threshold where:

• a person acquires, directly or indirectly, itself or in concert with other parties acting on its behalf, shares representing voting rights in excess of a third of the total voting rights in the target company; or

• a person holding more than a third but less than a half of the total voting rights in the target company acquires shares representing more than 3% of the voting rights in the target company within six months.

Acquisition of a public company in Greece may be generally structured in the same manner as in that of a private company. A key consideration in this regard is whether the involved parties’ intention is for the target company to remain listed or go private.

A tender offer process remains the typical transaction structure for acquisitions of a public company. However, mergers or other types of corporate transformations have been also utilised in certain instances.

Pursuant to Greek Law 3461/2006, in public takeover bids, the bidder may offer fair and reasonable consideration in cash or securities (whether listed or not on a regulated market) or a combination of both. However, in mandatory bids, the recipients must be offered the discretion to choose cash consideration.

The above-mentioned law sets out certain criteria as to what constitutes fair and reasonable consideration, depending on the type of consideration offered. Additionally, in specific instances when the offeror has acquired shares during the offer period, the offer cannot be on less favourable terms.

Under Greek law, public takeover offers may not include any conditions apart from those regarding regulatory approvals, such as merger clearance and the issuance of any securities offered as consideration in the context of the offer.

Greek Law 3461/2006 sets out the documents that are required by law in the event of a tender offer and the offeror typically sets out the respective terms and conditions in its offer document. A definitive agreement in respect of the tender offer may be essentially concluded by means of a written declaration of acceptance from the recipients of the offer. Other than that, the conclusion of supporting share purchase agreements (SPAs) may also be opted for and may follow the typical form of an SPA – including an agreed set of representations and warranties, adjusted where necessary to fit the needs of a takeover offer. In certain cases, bidders opt for a simplified SPA version with minimum content.

In general, tender offers are not subject to any acceptance conditions. Voluntary offers, however, may include minimum acceptance conditions. In this context, bidders typically aim at obtaining control of the company for which a tender offer is submitted. This essentially means that more than 50% of the voting rights in the target company will be required, so the respective minimum condition threshold could be set accordingly (taking into account any stake the offeror already holds in the company). However, under Greek corporate law certain resolutions of a company’s general meeting require an increased majority of 67%, so increasing the targeted stake at such level may be preferable for prospective bidders.

Tender offers without a minimum acceptance condition are also not uncommon in the Greek market.

An offeror that, following a tender offer addressed to all shareholders of a Greek listed company for the entirety of their shares, holds at least 90% of the voting rights in such company has the right to squeeze-out the remaining minority shareholders of the company. The squeeze-out right may be exercised within three months of the lapse of the tender offer acceptance period, on condition that a relevant clause has been included in the information memorandum for the tender offer. The consideration must be in the same form and at least equal to the consideration of the tender offer but, in any case, the alternative of cash consideration needs to be available at the discretion of the recipients.

A sell-out right is also provided by law within the same time limits in favour of minority shareholders that remain in the target company where an offeror acquires more than 90% of the voting rights.

Where the consideration of a takeover offer is in the form of cash, the offeror must provide a confirmation by a Greek or EU credit institution that the offeror possesses the funds for the full payment of the amount that may potentially be paid in the context of the takeover offer. Where the consideration of the offer is in the form of securities, the offeror must provide a confirmation by a Greek or EU investment firm or credit institution that the offeror possesses the securities offered as consideration or that – as the case may be – it has taken all appropriate measures to ensure that the consideration will be paid.

Deal protection measures, such as break-up fees, are not common in Greece. There have been a few transactions where such measures have been agreed between the parties, but the sample size is too small to fully assess their enforceability. General principles of Greek law, such as limitations regarding abusive exercise of rights, may also play a part in limiting the enforceability of such clauses.

A voluntary tender offer can be withdrawn where a competing offer is submitted to the HCMC or following prior approval of the HCMC in exceptional cases – not attributed to actions of the offeror itself – that render the continuation of the offer overly burdensome for the offeror.

A bidder may obtain effective control over a target by acquiring a shareholding stake of more than 50%. Furthermore, as noted in 6.7 Minimum Acceptance Conditions, a stake of at least 67% will also capture any matters requiring increased majority at the level of the company’s general meeting – thus ensuring an adequate level of control over the company’s operations even with a stake below 100%.

As mentioned in 6.7 Minimum Acceptance Conditions, irrevocable commitments by principal shareholders may be sought, as an additional means of supporting the transaction and increasing “deal certainty”. Depending on the parties’ negotiating power, such commitments may or may not provide for an “out” in case a better offer is made.

A person intending to submit a takeover offer (whether voluntary or mandatory) has to provide prior notification in writing to the HCMC. Prior to such notification, no announcement to the public may be made. On the next business day following such notification, the offeror has to announce the takeover offer on its website and in the daily bulletin announcements of the Athens Stock Exchange. The offeror is also required to publish an information memorandum including sufficient information – as provided by applicable law – that will enable the recipients to form an opinion on the offer.

The takeover offer acceptance period commences from the publication of the relevant information memorandum and cannot be shorter than four weeks or longer than eight weeks. The HCMC may extend the period by a maximum of two weeks, at the request of the offeror.

Any required regulatory approvals are typically obtained within the above-mentioned timeframes.

Setting up a new company in Greece is now a rather quick and straightforward process – with the exception of companies engaging in specific regulated activities (eg, financial or insurance services), which may be subject to prior approval/licensing by the competent regulatory bodies, such as:

• the Bank of Greece, as regards financial and credit institutions and insurance companies;
• the HCMC, as regards investment firms and any other entities supervised by it;
• the Hellenic Gaming Commission; and
• the Hellenic Telecommunications and Post Commission (EETT).

Companies in the technology sector are also subject to the horizontal provisions of Regulation (EU) 2016/679 (the “General Data Protection Regulation” (GDPR)) and Greek Law 4624/2019, which supplements the GDPR. The competent supervisory authority monitoring compliance with the GDPR and Greek Law 4624/2019 is the Hellenic Data Protection Authority.

Buyers should examine the target’s compliance with industry-specific vertical legislation. By way of example, operators of essential services (OESs) (eg, companies in the digital infrastructure sector, such as Internet Exchange Points) and digital service providers (DSPs) (cloud service providers, online marketplaces and search engines) are subject to a set of network and information systems security requirements introduced by Greek Law 5160/2024, which transposed into the Greek legal framework Directive (EU) 2022/2555 on measures for high common level of cybersecurity across the Union (the “NIS2 Directive”).

The National Cybersecurity Authority (established under Greek Law 5086/2024) is designated as the Computer Security Incident Response Team (CSIRT) and is competent to supervise and monitor the application of Greek Law 5160/2024.

In addition, Greek Law 4961/2022 on emerging information and communication technologies and strengthening of digital governance provides for further obligations applicable to DSPs and OESs, including cybersecurity measures for the development, importation, distribution and use of internet of things (IoT) technology devices. Moreover, specific rules apply to providers of public communication networks or publicly available electronic communication services, which for certain services need to operate under a general authorisation regime. The competent authority in this regard is the EETT. Additionally, newly introduced Greek Law 5099/2024, which supplements the EU Regulation 2065/2022 (the “Digital Services Act”), gave EETT the authority to set up and operate a Registry of Intermediary Service Providers. Providers of intermediary services, including mere conduit services, caching services, online search engines and hosting services, have the obligation to register with EETT’s relevant e-Registry (existing providers had to do so by 22 October 2024).

Furthermore, as the EU AI Act will gradually enter into force, technology companies who act as providers of AI systems (ie, develop or place AI systems into the European market) or as importers or distributors of AI systems (ie, import or distribute AI systems within the EU) – or even companies who use AI systems within the EU – should carefully assess their AI systems to determine the applicable risk category and implement the necessary measures to comply with the EU AI Act. In terms of regulatory framework, permits and approvals are not provided for; however, in the case of high-risk AI systems, there are requirements for conformity assessments, registration in the EU database, and post-market monitoring. On 12 November 2024, the Ministry of Digital Governance announced that the national authorities and bodies responsible for enforcing or supervising compliance with the obligations under the EU AI Act include the Hellenic Data Protection Authority, the Ombudsman, the Authority for Communication Security and Privacy, and the Commission for Human Rights. Additional powers will be added to the afore-mentioned bodies, such as access to any documentation created or maintained by organisations for compliance with the EU AI Act, which will come into effect on 2 August 2026.

There is no designated securities market regulator for M&A transactions in Greece. Depending on the type of the transaction and the companies involved (whether they are listed or not, whether they engage in any regulated activities, etc), a number of local regulators could come into play:

• the HCMC and the Athens Stock Exchange with regard to listed entities;
• the Hellenic Competition Commission (HCC), which is entrusted with monitoring and promoting competition in the Greek market, as well as reviewing M&A transactions that meet the jurisdictional thresholds set out in Greek Law 3959/2011 (the “Greek Competition Act”); and
• any of the other regulatory bodies referred to under 7.1 Regulations Applicable to a Technology Company.

In principle, most restrictions on foreign investments in Greece have been abolished, as the country is constantly aiming at becoming an attractive investor destination. Nevertheless, certain investment restrictions continue to apply, including the following.

• Non-EU/European Free Trade Association (EFTA) natural or legal persons may not proceed with any transaction without a prior approval from the competent decentralised administration office, in which a contractual right or a right in rem is granted in their favour, or unless such persons acquire shares of companies (irrespective of the companies’ legal forms) that own real estate property located in specific border regions of the country set out in Greek Law 1892/1990.
• Legislative Decree 210/1973 provides for special approval of contracts for the transfer to foreign (natural or legal) persons or for the use/exploitation of mining rights by such persons.

It is to be noted that, further to the adoption of the EU Foreign Direct Investment (FDI) Screening Regulation, there has been increased regulation regarding foreign investments in many EU member states. Greece, however, has not yet implemented an FDI screening mechanism.

Except for the restrictions mentioned in 7.3 Restrictions on Foreign Investments, there are currently no further national security review/export control regulations applicable in Greece.

Takeovers and business combinations (including full-function joint ventures) may be notifiable to the HCC, provided the entities involved meet certain turnover-related thresholds, as set out in the Greek Competition Act. The parties involved are subject to a standstill obligation not to consummate the respective transaction until it has been cleared by the HCC. The statutory framework is almost identical to that of the EU and HCC decisions are usually in line with EU case law and practices.

The statutory merger control thresholds that would trigger a notification obligation to the HCC are stipulated in Article 6 of the Greek Competition Act and are as follows:

• the combined worldwide turnover of all undertakings concerned amounts to at least EUR150 million; and
• each of at least two undertakings concerned has an aggregate Greek turnover exceeding EUR15 million.

The above-mentioned criteria must be cumulatively met.

Under the provisions of the Greek Competition Act, the turnovers of the parties are calculated at a group level (ie, they include turnover of all entities belonging to the same group of companies), and they include all products and services offered by the parties.

Larger transactions may be notifiable to the EC if the respective thresholds set out in Council Regulation No 139/2004 (the EC Merger Regulation) are met.

The main labour law considerations concerning M&A transactions in Greece usually revolve around the issue of a transfer of business and the protection of the rights of employees in the context of such transfer. Thus, the most common instances of such issues are identified either in transactions structured as asset deals or in transactions involving some type of corporate transformation (eg, a demerger or a spin-off), given that share deals do not result in a change in the identity of the employer.

A transfer of business within the meaning of the Greek TUPE (Transfer of Undertakings (Protection of Employment)) legislation (Presidential Decree 178/2002) occurs when the transferred economic entity retains its identity, meaning an “organised grouping of resources” (eg, tangible and intangible assets, licences, personnel and customers) that has the objective of pursuing an economic activity– whether that activity is central or ancillary. The tendency of the Greek courts is to interpret the above-mentioned definition in a wide manner and in favour of the employees. Indicatively, the courts base their assessment on the transfer of (tangible and intangible) assets, transfer of personnel, transfer of clientele, continuation by the transferee of the same or similar business activity, etc. Based on the foregoing criteria, in the event an acquisition falls within the scope of the Greek TUPE legislation, there will be a transfer of the respective employees to the new employer by operation of law. The acquirer will assume the obligations of the seller towards such employees, while the seller will remain jointly liable with the acquirer for any obligations attributed to the period up until the transfer.

A prior consultation with the affected employees and/or their representatives takes place in due time prior to the transfer, in order to inform them of such transfer and minimise – to the extent possible – any risk of employees challenging the transfer to the new employer.

Except for AML rules, there is no currency control regulation or requirement for central bank approval regarding M&A transactions.

During the past three years, there has been a number of interesting legal developments surrounding M&A transactions in Greece in general and technology M&A as well. More specifically, these pertain to corporate transformations, merger control and family offices.

Merger Control

The Greek Competition Act has been recently amended and significant changes were introduced to the competition law framework in Greece, including amendments to the merger control rules, particularly the following.

• The HCC has been empowered to impose remedies in “Phase I” clearance decisions, whereas previously it was only empowered to impose remedies in the context of “Phase II” clearance decisions, which often led to prolonged transaction timelines as notified deals were “pushed” towards a “Phase II’” scrutiny because an unconditional clearance under “Phase I” would be deemed inappropriate.
• The Minister of Finance and the Minister for Development and Investments may now – by joint decision published after a public consultation – amend the turnover-related thresholds mentioned in 7.5 Antitrust Regulations, as well as impose ad hoc thresholds for different economic sectors. Such decision must be based on statistics collected by the HCC, following mapping of the relevant markets as well as the competitive conditions therein for the past three years.

The above-mentioned developments have been welcomed as a step in the right direction. However, in turn, this could mean higher scrutiny of transactions meeting the jurisdictional thresholds and lead to extended timelines – especially considering that the local regulator has been very active recently.

Cross-Border Transformations

Recently passed Greek Law 5055/2023 transposed Directive (EU) 2019/2121 on cross-border conversions, mergers and demergers of capital companies into domestic legislation, aiming to compile the regime of cross-border corporate transformations into a single framework through the completion of the existing legislative framework (which, until now, only concerned cross-border mergers) with the addition of provisions concerning cross-border demergers and conversions of capital companies. Moreover, the provisions of the new law on cross-border conversion constitute an explicit legal regime for the transfer of the seat of a company to another EU member state, unlike the non-regulated process previously followed – thereby fostering the fundamental principle of freedom of establishment.

Incentives for Investments in Start-Ups

Newly introduced Greek Law 5162/2024 includes significant tax incentives for investments by angel investors in Greek start-ups and Greek venture capital funds, while also aiming to address the need for more clarity on the tax treatment of Greek venture capital funds in the form of a closed-end venture capital mutual fund (amoivaio kefalaio epicheirimatikon symmetochon kleistou typou, or AKES) (as regulated by Article 7 of Greek Law 2992/2022) and their unit-holders. The new law also introduces a “new residence by investment” permit for third-country nationals who contribute at least EUR250,000 to the capital of a start-up registered with the National Start-up Registry (NSR) Elevate Greece (through acquisition of shares or subscription for bonds) and also meet certain additional criteria to qualify for and maintain such residence permit.

In general, due diligence on public companies is more limited compared to private M&A transactions and is primarily based on publicly available documents. Selling shareholders may also be in a position to share some limited information with the prospective buyers, provided they comply with the stipulations of the EU Market Abuse Regulation and any other confidentiality restrictions imposed on them.

When providing information to bidders in the context of due diligence, public companies should also ensure the protection of their trade secrets and their intellectual and industrial property rights, including on databases, software, patents, and know-how. Appropriate non-disclosure agreements should be in place.

As a rule of thumb, the same level of information should be made available to all bidders.

Greek Law 3461/2006 imposes a neutrality obligation on the company’s board of directors, as of when it is notified of the tender offer and until publication of the result of the offer (or withdrawal thereof). Therefore, the board cannot proceed with any action outside the company’s ordinary course of business that could impede the tender offer – including in the course of any due diligence conducted on the company – unless with the prior authorisation of the general meeting of shareholders.

As is often the case, technology companies are data-driven or data-related; therefore, considerations around the protection of personal data are relevant in due diligence exercises. 

Sharing, disclosing, exchanging and getting access to documents and information directly or indirectly identifying individuals, in the context and for the needs of a due diligence process, constitutes processing of personal data. In this respect, the buyer and target company act as controllers of personal data and are under the obligation to ensure compliance with the provisions and restrictions of applicable data protection legislation, with the GDPR and with Greek Law 4624/2019. Considering applicable sanctions, compliance with data protection rules should be a priority in a due diligence process, especially on the part of the target company. This may effectively entail limiting the extent, volume or nature of information shared with a buyer, as well as with other third parties (including auditors, consultants and virtual data room providers).

Importantly, only personal data that is absolutely necessary should be disclosed by the target company and processed by the buyer (principle of data minimisation). Any sharing and further processing of personal data must be conducted in a manner that ensures an appropriate level of security of the personal data – including protection against unauthorised or unlawful processing and against accidental loss, destruction or damage – by implementing appropriate technical and organisational measures (principles of integrity and confidentiality).

It is critical that data subjects (eg, the target company’s employees, customers, and suppliers) whose personal data are to be disclosed to the buyer and other third parties during the due diligence process have been properly informed, in advance and in accordance with the GDPR standards, about such processing. In this context, the option of sharing anonymised or pseudonymised data for the purposes of the due diligence should always be examined and preferred, when the information purposes can still be properly served.

Furthermore, data protection provisions should be included in the non-disclosure agreements executed between the parties – by virtue of which, restrictions must be imposed on the buyer in relation to the ways it can process any personal data disclosed and, in particular, in relation to the time period for which said data can be retained by the potential buyer. Moreover, additional provisions may determine the deletion or return of the data if the transaction is aborted. These provisions should be applicable to other third parties with which the buyer may share the personal data disclosed during the due diligence process, such as external consultants.

Special attention is needed in transactions where the buyer is located outside the EU/European Economic Area (EEA); in such case, the disclosure of personal data to the buyer would constitute an international transfer of personal data. Special rules apply for such transfers, which – depending on the recipient country – may require appropriate safeguards to ensure an adequate level of protection, including:

• the execution of the standard contractual clauses approved by the EC;
• carrying out a transfer impact assessment (TIA); and
• the adoption of supplementary technical measures.

A bid is made public either when an offeror decides to proceed with a (voluntary) takeover bid or when the mandatory offer thresholds set out in 6.2 Mandatory Offer are triggered. The relevant steps are as follows:

• the offeror must notify the HCMC and the target company’s board of directors in writing; and

• within the following business day, the offeror must announce the takeover bid on its website and in the daily bulletin announcements of the Athens Stock Exchange.

The boards of directors of the target company and of the offeror must inform the representatives of their employees or, where there are none, the employees directly about the takeover bid without undue delay.

Regulation (EU) 2017/1129 (the “EU Prospectus Regulation”) is applicable in Greece as regards the specific cases of share offerings triggering a prospectus requirement. Shares offered in a stock-for-stock offer are exempted from such a requirement, provided an equivalent document containing information describing the transaction and its impact on the issuer is made available. There is also no requirement for the buyer’s shares to be listed on a specified exchange or other identified markets.

Under Greek law, bidders are not required to produce financial statements as such in their disclosure documents in a cash or stock-for-stock transaction. In general, though, there is a requirement for Greek companies to publish their approved annual financial statements and these are made publicly available on the website of the General Commercial Registry (and, in certain cases, on the companies’ websites as well).

In a merger, the merger plan is filed with the General Commercial Registry. As regards takeover bids, the information memorandum is filed with the HCMC. Other than the foregoing, there is no requirement to file copies of any transaction documents (eg, share purchase agreements concluded in the context of takeover bids) with any competent authority.

The principal duties of directors of Greek companies are designated in a general context, rather than specifically regarding business combinations. Such duties include the following.

• Duty of care – the obligation to:
1. act within their powers and in accordance with the law, the company’s articles of association and the legitimate resolutions of the general meeting;
2. promote the interests of the company;
3. monitor the execution of the resolutions of the board and the general meeting;
4. inform the other members of the board about company matters;
5. maintain the books and records provided under applicable law (eg, tax books, the Shareholders’ and Ultimate Beneficial Owners’ Register); 
6. prepare and file with the corporate registry in a timely manner the company’s annual financial statements in accordance with applicable law;
7. prepare and approve the directors’ annual management report (accompanying the annual financial statements);
8. file with the corporate registry all corporate actions provided under applicable law; and
9. file a lawsuit on behalf of the company against any member of the board (or any other party with administrative powers) who damaged the company by virtue of their actions or omissions.
• Duty of loyalty – the obligation to:
1. nοt pursue individual interests that are contrary to the interests of the company;
2. duly disclose to the other board members in a timely manner any personal interest or interests of their close family that may arise from the company’s transactions and fall within their duties; and
3. refrain from voting on issues with a potential or factual conflict of interests.
• Duty of confidentiality – the obligation to keep confidential information and matters of the company that were made known to them in view of their capacity as board members.
• Non-compete obligation – the obligation to:
1. not engage in acts that are considered competitive to the company’s operation (ie, acts that fall within the company’s purpose and are proceeded for the member’s or a third party’s interests are forbidden), unless special permission has been granted by the general meeting; and
2. not participate as partners in general or limited partnerships or as sole shareholders/partners in companies with the same purpose, unless special permission has been granted by the general meeting or a relevant provision exists in the company’s articles of association.

See 9.1 Technology Company Due Diligence in relation to the board of directors’ neutrality obligation in the case of tender offers.

The establishment of special or ad hoc committees in business combinations by the board of directors is not very common in the Greek market – although there have been instances of companies deploying such a strategy (especially larger listed entities). As noted under 11.1 Principal Directors’ Duties, under Greek law there is in any case a requirement for directors to disclose conflicts of interest and to refrain from voting on any such matters.

The board is usually expected to be actively involved in the negotiations for a proposed transaction, as it constitutes the principal management body of the company and is entrusted with deciding on any act concerning the administration of the company, the management of its property and the general pursuit of its purpose, as well as representing the company judicially and extra-judicially. The foregoing is subject to the caveat of the neutrality obligation imposed on the board of directors in the context of takeover bids.

Shareholder litigation challenging the board’s decision to pursue an M&A transaction is not very common in Greece. Greek courts tend to side with the recommendations of the board in such cases, provided the directors have shown – in the performance of their duties – the diligence of a prudent businessperson operating in similar circumstances (business judgement rule), which is also the standard for limiting any related liability of the directors.

Prior to entering into an M&A transaction, bidders should ideally do some preparatory work and obtain information on the target company’s shareholders, as well as any previous cases of shareholder activism.

Directors are generally supported by a wide range of advisers in connection with takeover and/or business combinations. These can indicatively include financial, legal, tax and technical advisers engaged during different stages of the transaction, depending on the specific needs and complexities of each case.

Greek Law 4601/2019 on corporate transformations provides that, in the case of merger, the draft demerger deed needs to be examined by one or more independent expert/s (eg, certified public accountants, auditing firms). The expert/s will then need to produce a written report on the draft demerger deed,  addressed to the company.

As regards takeover bids, the offeror must engage a Greek or EU credit institution or investment firm to act as the offeror’s financial adviser and verify the accuracy of the information memorandum. In addition, the board of directors of the target company must also prepare and publish an opinion on the takeover bid, which must be accompanied by a detailed report prepared by a financial adviser with the same characteristics (ie, a Greek or EU credit institution or investment firm).