The Zambian M&A market is quite vibrant as compared to 12 months ago as activity has been fuelled by, inter alia, the green transition and parties’ needs to secure the necessary critical minerals, and geopolitical tensions, which saw the rise of entities in the Far East and the Middle East, countering the influence of the West, as well as movement in the agricultural sector, which arose largely as a result of challenges that arose from Zambia’s drought-influenced energy shortage.

In the last 12 months, acquirers have leaned towards undertaking prolonged due diligence processes to ensure that they uncover any lurking issues in targets, whereas, on the other hand, sellers have become increasingly more open to undertaking M&A transactions through auction processes involving a number of bidders. We have also seen the government adopt the auction sale process when disposing of major state assets and an increase in the entry of public-private partnerships and joint ventures with government entities for projects.

We have also witnessed increasing interest in Zambia and diverse businesses/business assets in wide-ranging sectors such as mining, infrastructure and agriculture from entities in the Middle East and Far East.

We witnessed significant M&A activity in the mining sector and the agricultural sector, as well as the poultry sector, the banking sector and the tourism sector.

The primary legal means for acquiring a company in Zambia include:

• acquisition of an interest in a company through a share transfer;
• acquisition of an interest in a company through an issuance/allotment of shares; and
• acquisition of the assets of a target business.

The primary regulators for M&A activities in Zambia are:

• the Patents and Companies Registration Agency, which was established under the Patents and Companies Registration Agency Act, No 4 of 2010 and is responsible for the registration and regulation of companies;
• the Competition and Consumer Protection Commission (CCPC), which was established under Section 4 of the Competition and Consumer Protection Act, No 24 of 2010 (“Competition Act”). The CCPC is responsible for reviewing the operation of markets in Zambia and the conditions of competition in those markets, as well as investigating and assessing abuse of dominant positions and mergers;
• the Securities and Exchange Commission (SEC), which was established under Section 7 of the Securities Act, 2016 (“Securities Act”). The SEC regulates public M&A transactions, ensuring compliance with the Securities Act and the Securities (Takeovers and Mergers) Rules (the “Takeover Rules”); and
• the Zambia Revenue Authority (ZRA), which oversees tax-related aspects of M&A transactions, ensuring compliance with applicable tax legislation.

Other regulators such as the Bank of Zambia (BOZ) and the Energy Regulation Board are also primary regulators of M&A activity in their respective sectors.

There are generally no restrictions on foreign investment in Zambia.

Antitrust regulations applicable to business combinations are provided for under the Competition Act.

Generally, in terms of Section 8 of the Competition Act, any category of agreement, decision or concerted practice which has, as its object or effect, the prevention, restriction or distortion of competition to an appreciable extent in Zambia is anti-competitive and prohibited.

Additionally, the following regulations apply:

• Horizontal agreements between enterprises are prohibited per se, and void, where the agreement:
1. fixes, directly or indirectly, a purchase or selling price or any other trading conditions;
2. divides markets by allocating customers, suppliers or territories specific types of goods or services;
3. involves bid rigging, unless the person requesting the bid is informed of the terms of the agreement prior to the making of the bid;
4. sets production quotas; or
5. provides for collective refusal to deal in, or supply, goods or services;
• Vertical agreements between enterprises are prohibited per se, and void, to the extent that they involve resale price maintenance. However, a supplier or producer may recommend a minimum resale price to the reseller of a good or a service if the supplier or producer makes it clear to the reseller that the recommendation is not binding and if the product has a price stated on it and the words “recommended price” appear next to the stated price;
• Any other agreement between enterprises may be prohibited by the CCPC, where it determines that the agreement has the effect of preventing, distorting or restricting competition or substantially lessening competition in a market for any goods or services in Zambia;
• Parties to – (i) a horizontal agreement who together supply or acquire 15% or more of goods or services of any description in a relevant market in Zambia; or (ii) a vertical agreement who individually supply or acquire, at either one of the two levels of the market that are linked by the agreement, 30% or more of goods or services of any description in a relevant market in Zambia, must apply to the CCPC for authorisation of the horizontal or vertical agreement;
• Enterprises must refrain from any act or conduct if, through abuse or acquisition of a dominant position of market power, the act or conduct limits access to markets or otherwise unduly restrains competition, or has or is likely to have an adverse effect on trade or the economy in general; and
• Parties to a merger that meets the prescribed threshold must apply to the CCPC for authorisation of the proposed merger. A merger is a notifiable merger under Section 26 (1) and (5) of the Competition Act as read together with regulation 8 of the Competition General Regulations, whenever the combined domestic annual turnover or assets (whichever is greater) of the merging parties to the transaction in Zambia is ZMW40 million or more (approximately USD1,379,310).

In Zambia, acquirers involved in M&A must pay attention to the following key labour laws:

• the Employment Code Act, No 3 of 2019, which is the Act that regulates the employment of persons, provides employment entitlements and other benefits, prohibits discrimination, and provides for employment policies, procedures and codes in an undertaking;
• the National Pension Scheme Act, No 40 of 1996 as amended by Act No 7 of 2015, which provides for mandatory pension contributions to the National Pension Scheme Authority;
• the National Health Insurance Act, No 2 of 2018 as read together with the National Health Insurance (General) Regulations, Statutory Instrument No 63 of 2019, which provides for mandatory health insurance registrations and contributions to the National Health Insurance Management Authority; and
• the Workers’ Compensation Act, No 10 of 1999, which provides for mandatory social insurance schemes under the Workers’ Compensation Fund Control Board.

Currently, there is no national security review process for acquisitions in Zambia.

In the Teal Minerals case (Teal Minerals Barbados Incorporated v the Zambia Revenue Authority, Appeal No. 4 of 2022), the Zambian Supreme Court clarified the position on the payment of property transfer tax (PTT) on the transfer of shares in a company that indirectly owns shares in a Zambian company that holds a “mining right”, which includes a mining licence.

In particular:

• an offshore transfer of shares in a company which directly/indirectly holds shares in a Zambian mining company will be considered to be a transfer of an interest in the “mining right” held by the Zambian company, thereby attracting the payment of PTT on the transfer of the interest in the mining right. To this extent, parties involved in such transactions should bear in mind the need to pay PTT in addition to obtaining consent for the transaction from the Minister of Mines and Mineral Development; and
• the PTT rate will be calculated based on the actual sale price of the interest in the “mining right”, although the Commissioner-General of the ZRA may calculate the PTT based on a higher amount, if the Commissioner-General is of the opinion that the parties to the sale agreement have deliberately deflated the sale price.

However, to avoid taxing the taxpayer twice, ie, on both the transfer of shares and on the transfer of an interest in a mining right where a share transfer occurs directly or indirectly in a company that holds a mining right, Zambia’s Property Transfer Tax Act, Chapter 340 of the laws of Zambia, was amended in 2022. The effect of the amendment is that in such a transaction, only PTT on the transfer of shares will be payable as the definition of a share now includes an interest in a mining right.

There have been no significant changes to takeover laws in the past 12 months, and we are not aware of any takeover legislation currently under review that could result in significant changes in the next 12 months.

While not very common, bidders may build a stake in the target prior to launching an offer. Stakebuilding is usually utilised to enhance the likelihood of a successful future takeover as the bidder would have already secured a strategic position in the target and would therefore be capable of influencing an offer. Where the target is publicly traded, the bidder will need to comply with material shareholding disclosure requirements as discussed under 4.2 Material Shareholding Disclosure Threshold. A key stakebuilding strategy involves the gradual acquisition of shares in the target over a period of time, as sudden large acquisitions may lead to sudden market fluctuations. Further, while stakebuilding is permissible, it must be borne in mind that for both private companies and publicly traded companies, the number of shareholders should not fall below two.

Under Zambia’s securities legislation, a “substantial shareholder” must give notice, in writing, to a listed company or company whose securities are registered with the SEC, if the person/entity:

• acquires further shares in that company; or
• disposes of shares as a result of which the person/entity ceases to be a “substantial shareholder” of that company.

A person/entity is considered to be a “substantial shareholder” if the person/entity is the beneficial owner of, or is in a position to exert control over, at least 15% of the shares of the company.

The disclosure notice by a “substantial shareholder” must contain the following:

• the total number of shares acquired or disposed of;
• the prices paid or received for the acquired or disposed-of shares; and
• the resultant total amount of shares held in the company and the percentage of shares it represents.

The disclosure notice must be made five days after the acquisition of the shares. Once the listed company or company whose securities are registered with the SEC receives the disclosure notification from the substantial shareholder, it is required to enter the notified information in its register and specify the date of entry. The company is in turn required to notify the SEC and the listing exchange, where applicable, before the expiry of a period of five days from the date on which the company was notified by the substantial shareholder.

Further, the target whether publicly traded or not is required to notify the Registrar of Companies of any changes in shareholding or beneficial ownership within 14 days of the change. Generally, a beneficial owner is a natural person who directly or indirectly owns at least 5% of the shares in the company or benefits from at least 5% of the distributed dividends. In practice, however, it is difficult for a publicly traded company to notify the Registrar of Companies of changes in its shareholding where its shareholding is subject to frequent changes.

A company may introduce, through its articles of incorporation, higher reporting thresholds but cannot introduce lower reporting thresholds than those provided for by legislation. Another hurdle to stakebuilding in Zambia is the pre-emptive rights provided for under Zambia’s companies legislation. Under the existing legislation, a company is required to offer shares proposed to be issued and that rank equally with shares already issued to the existing shareholders in a manner and on terms that would, if accepted, maintain the existing voting or distribution rights, or both, of those shareholders.

Further, it is also common for the articles of incorporation or the shareholders’ agreement to provide that an existing shareholder cannot transfer its shares without first offering the shares to other existing shareholders. As such, stakebuilding may be hindered by the need to have other existing shareholders waive their pre-emptive rights prior to any acquisition occurring. However, in practice, the pre-emptive rights can be waived fairly easily through the issuance of a letter, or the waiver can be included in the shareholder resolution approving the allotment of the shares or the transfer of the shares.

Dealings in derivatives are permissible in Zambia, and derivatives are considered as securities under the Securities Act. As such, the obligations and requirements relating to ordinary securities generally apply to derivatives.

If the derivatives would enable the derivatives holder to exert control over at least 15% of the shares of a listed company, then the filing/reporting requirements set out under 4.2 Material Shareholding Disclosure Threshold will need to be complied with. Similarly, if a transaction involving derivative instruments would result in a change of control as envisaged under the Competition Act and meet the financial threshold for notifiable transactions, the transaction would need to be notified to the CCPC or the COMESA Competition Commission, as may be applicable.

Shareholders are generally not required to disclose the purposes of their acquisition and their intention regarding control of the company. However, the Takeover Rules require that the offer document submitted by the offeror to the offeree shareholders must contain all such information as is necessary to enable offeree shareholders to reach a properly informed decision.

Save for public companies, there are no statutory prescribed stages when the target is required to disclose a deal, and in practice, it is common for deals to be disclosed when definitive agreements are signed. For public companies, the Takeover Rules require an offer to be put forward, in the first instance, to the board of the target or to its advisers and before the offer is announced to the public. The circumstances in which an announcement of an offer is required include:

• when a firm intention to make an offer is notified to the board of the offeree company from a serious source, irrespective of the attitude of the board to the offer;
• when, following an approach to the offeree company, the offeree company is the subject of rumour and speculation, or there is undue movement in its share price or a significant increase in the volume of share turnover, whether or not there is a firm intention to make an offer; or
• when, before an approach has been made, the offeree company is the subject of rumour and speculation or there is undue movement in its share price, and there are reasonable grounds for concluding that it is the potential offeror’s actions which have led to the situation.

A listed company or company whose securities are registered with the SEC that proposes a takeover or merger, or is being taken over by another company as envisaged by the Securities Act, must also apply for and obtain the SEC’s approval prior to implementing the takeover or merger. Additionally, if the prescribed merger and financial thresholds under the Competition Act are met (for both private and public companies), the proposed deal would need to be disclosed to and approval obtained from the CCPC or the COMESA Competition Commission, as the case may be.

Other regulatory disclosures and approvals would need to be made/obtained depending on the particular industry/sector. These include disclosures to and approvals from BOZ for an M&A deal involving the banking sector.

Market practice on timing of disclosure does not differ from the legal requirements set out under 5.1 Requirement to Disclose a Deal.

A red flag due diligence is usually undertaken and covers the legal, financial and tax matters of the target. It is also common for parties to agree on a materiality threshold for the issues to be covered in the due diligence and physical site visits where this is deemed to be necessary.

It is not rare for standstills or exclusivity to be demanded in M&A transactions. However, the standstills demanded must not be in breach of Zambian law. The Companies Act, No 10 of 2017 (the “Companies Act”), for example, provides that fully paid-up shares ought to be freely transferable without restrictions unless a contrary indication is provided for in the articles of association. However, the articles of association of a private company cannot impose any restriction on the transferability of shares after they have been issued, unless all the shareholders have so agreed in writing.

The usual practice in Zambia is to have the tender offer terms and conditions documented. For publicly traded companies, the Takeover Rules require that the offer document should contain all such information as is necessary to enable offeree shareholders to reach a properly informed decision.

The timeline for acquiring or selling a business in Zambia depends on various factors, including the structure/complexity of the transaction, the type of company (ie, whether it is a private company or public company), sector-specific regulatory approvals and the extent of due diligence to be undertaken. However, the process generally takes anywhere from five to nine months to be completed.

Zambia has a mandatory offer threshold under the Takeover Rules, regulated by the SEC. A mandatory offer must be made by any person who acquires more than 35% of the voting rights of a listed company or by any person or persons who hold between 35% and 50% of the voting rights of a company and acquire more than 5% of the rights of the company in any 12-month period.

In Zambia, both cash and shares are used as consideration in M&A transactions. This notwithstanding, parties more often than not prefer to use cash as consideration as opposed to shares.

Tools that are used to bridge value gaps between parties include, inter alia, earn-outs, where a portion of the purchase price is contingent on the target achieving certain financial or operational milestones post-closing, and escrow arrangements, where a portion of the purchase price is held in escrow and released based on agreed performance criteria.

The Takeover Rules do not restrict the use of offer conditions. Common offer conditions include minimum acceptance conditions, where the offer is conditional upon acquiring a specified percentage of shares, regulatory approvals, due diligence completion, and shareholder and board approvals.

The minimum acceptance condition in a tender offer is typically set based on the relevant control thresholds under the Securities Act, the Companies Act and the Takeover Rules.

Most bidders set the minimum acceptance condition at:

• 50%+1 of voting rights (Simple Majority Control), to ensure the bidder gains effective control over the target, allowing the passage of ordinary resolutions at shareholder meetings;
• 75% of voting rights (Special Resolution Control), to allow the bidder to approve special resolutions; and
• 90% of voting rights (Compulsory Squeeze-Out Threshold). If the bidder secures 90% or more of the shares, it can trigger the compulsory acquisition (squeeze-out) process under the Companies Act.

There are no restrictions prohibiting a condition on the bidder obtaining financing.

Deal security measures that a bidder can seek include, inter alia, exclusivity agreements, where the target agrees not to solicit or engage with other potential buyers for a specified period, break fees (termination fees) payable by the target if it terminates the deal due to certain conditions (eg, accepting a higher competing bid), and no-shop clauses, preventing the target from actively seeking alternative bids. However, in the recent past, it has become more common for deals to be undertaken via auction process with multiple bidders getting involved in the acquisition process and all bidders providing their preferred terms and also putting in their proposed bid for the acquisition.

If a bidder in Zambia does not acquire 100% ownership of a target, it can still seek additional governance rights beyond its shareholding (such as board representation, reserved matters/veto rights, management and operational control rights and rights of first refusal) which would grant the entity the ability to exert control or influence over the company. These rights can be negotiated through shareholder agreements or articles of association.

If governance rights effectively grant de facto control, the deal may trigger competition approval requirements, even if the bidder owns less than 50% of the issued share capital of the target.

The Companies Act allows shareholders entitled to attend and vote at a meeting of the company to appoint another person as a proxy.

The appointment of a proxy is made in writing, in the prescribed form. Once appointed, a proxy has, in relation to the meeting and subject to any instructions in the document appointing the proxy, all the rights and powers of the appointing shareholder.

In terms of the Companies Act, a transferee company (acquiring company) can compulsorily acquire shares from remaining shareholders in a transferor company (target company) if:

• the offer is made to all shareholders, except those already holding shares for the acquiring company;
• the consideration includes either shares in the acquiring company or cash (at the shareholder’s option);
• all shareholders of the same class receive identical terms;
• the offer notice includes a description of the acquiring company’s power to effect the takeover, the acquiring company’s intention to use it, and the right of shareholders to object in court; and
• within four months, at least 90% of shares in each class have been tendered (including previously held shares).

If 90% acceptance is reached, the acquiring company will have 60 days to issue a compulsory acquisition notice to non-tendering shareholders, informing them that their shares will be acquired and that if they do not act, the acquisition will proceed automatically. If multiple consideration options were offered, the default option applies unless the shareholder specifies otherwise.

Shareholders can challenge the acquisition in court within 90 days of reaching the 90% threshold, seeking either a prohibition of the acquisition or a modification of the offer terms.

It is common for bidders in Zambia to seek irrevocable commitments from principal shareholders of the target company, especially in public M&A transactions or where a controlling stake is crucial to the deal. These commitments provide deal certainty and reduce the risk of competing bids.

In private deals, principal shareholders may sign sale and purchase agreements early in the process. In public transactions, irrevocable undertakings are sought before or at the time of announcing the tender offer.

For private companies, there are currently no mandatory requirements to make a bid public, and parties usually keep the bid details confidential. However, if the bid meets the prescribed merger and financial thresholds under the Competition Act, the bid will need to be disclosed to and approval obtained from the CCPC or the COMESA Competition Tribunal, as the case may be. The disclosure requirements set out under 5.1 Requirement to Disclose a Deal apply to public companies.

Generally, the regulatory disclosures and approvals as set out under 5.1 Requirement to Disclose a Deal are required for the issuance of shares in a business combination. Further, on a public issue of shares, a prospectus is required to invite the public to acquire shares in a public company. The prospectus must be registered with the Registrar of Companies prior to its issuance to the public and must contain, inter alia, all information that prospective purchasers of the shares or debentures and their advisers would reasonably expect to be provided in order to make a decision on the purchase.

Regulatory disclosures such as disclosures to the CCPC require the parties to an M&A transaction to file their latest audited financial statements. In terms of the Companies Act, the financial statements of a company in Zambia must comply with standards prescribed by the Zambia Institute of Chartered Accountants, which currently utilises the IFRS as the reporting standard.

In relation to public companies, the Takeover Rules also require that an announcement of an offer should also include confirmation by the financial adviser or by another appropriate third party that resources are available to the offeror sufficient to satisfy full acceptance of the offer.

Generally, where a deal is required to be disclosed, all material transaction documents are subject to full and prompt disclosure. In relation to public companies, the Takeover Rules specifically require all persons concerned with takeovers and mergers to make full and prompt disclosure of all relevant information and take every precaution to avoid the creation or continuance of an uninformed market.

The principal directors’ duties in a business combination are set out in the Companies Act and the Securities Act, and also informed by principles of common law. These duties include the following:

• exercising independent judgement;
• acting in the best interest of the company;
• avoiding conflict of interest; and
• ensuring that the company complies with all applicable laws and regulations.

In Zambia, directors’ duties are generally owed to the company and not the individual shareholders. However, the Court of Appeal in the case of Chirwa and Others v Mini Mart Development Corporation Appeal No 68/2021 clarified that it would be contrary to the core of the theory of corporate governance to hold that a director can act to the detriment of shareholders in the name of acting in the best interest of the company.

It is common for boards of directors to establish special or ad hoc committees in business combinations. These committees are typically formed to oversee specific aspects of the transaction, provide additional expertise, and ensure that the board’s decision-making process is thorough and unbiased.

The courts in Zambia would generally defer to the judgement of the board of directors in takeover situations if the following conditions are satisfied:

• the decision is made in good faith for a proper purpose;
• the members of the board of directors do not have a personal interest in the decision;
• the board of directors reasonably believe the decision is in the best interest of the company; and
• the company is appropriately informed of the subject matter of the decision.

In terms of the Companies Act and to the extent permitted by the articles of incorporation, board committees may consult with or receive advice from any person. Further, in terms of the Takeover Rules, the board of a public company that receives an offer is required to retain an independent financial adviser to advise the board as to whether the offer is, or is not, fair and reasonable.

In a business combination, financial and legal advice is commonly sought and given to directors.

Conflicts of interest of directors and advisers have been the subject of judicial scrutiny in Zambia. The Companies Act prescribes the circumstances under which a director will be considered to have a conflict of interest, and the courts generally refer to these circumstances in determining the various conflict of interest cases. The circumstances under which a director would be considered to have an interest in a transaction to which the company is a party include the following:

• if the director is likely to derive a material financial benefit from the transaction;
• if the director has a material financial interest in or with another party to the transaction; or
• if the director is the parent, child or spouse of another party to, or of a person who is likely to derive a material financial benefit from, the transaction.

Hostile tender offers are not expressly addressed under Zambian law. However, Section 189 of the Companies Act provides that, save for any limitation or restriction on the transfer of shares in the articles or the Companies Act, shares in a company are transferable without restriction provided they are fully paid up.

As such, hostile tender offers are generally permitted; however, they are not particularly common.

Directors are allowed to use defensive measures to prevent a hostile takeover. However, there is no express legal provision to this effect.

Common defensive measures include directors making an offer to acquire shares under Section 165 or 166 of the Companies Act.

Another common defensive measure is for the directors to find an alternative purchaser in order to avert the hostile tender offer.

Where directors are acquiring the shares of the company as a defensive measure, they have the duty to ensure that:

• the acquisition is in the best interests of the company and its shareholders;
• the terms of the offer and the consideration offered for the shares are fair and reasonable to the company and its shareholders; and
• the board is not aware of any information that has not been disclosed to the shareholders which is material to an assessment of the value of the shares and as a result of which the terms of the offer and consideration offered for the shares are unfair to shareholders accepting the offer.

The directors must set out in full, in their resolution to acquire the shares, the reasons for the board’s resolutions, and any directors who vote in favour of a resolution to acquire the shares must sign a declaration as to the duties set out above.

Additionally, the Takeover Rules place the following duties on directors of public companies:

• directors must have regard to the interests of the shareholders as a whole, and not their own interests or those derived from personal and family relationships; and
• at no time after a bona fide offer has been communicated to the board of an offeree company, or after the board of an offeree company has reason to believe that a bona fide offer might be imminent, may any action be taken by the board of the offeree company in relation to the affairs of the company, without the approval of shareholders in a general meeting, which could effectively result in any bona fide offer being frustrated or in the shareholders being denied an opportunity to decide on its merits. In particular the board must not, without approval of the shareholders:

1. issue any shares;
2. issue or grant options in respect of any unissued shares;
3. create or issue or permit the creation or issue of any securities carrying rights of conversion into, or subscription for, shares of the company;
4. sell, dispose of or acquire or agree to sell, dispose of or acquire assets of a material amount;
5. enter into contracts, including service contracts, otherwise than in the ordinary course of business; or
6. cause the company or any subsidiary or associated company to purchase or redeem any shares in the company or provide financial assistance for any such purchase.

The directors cannot “just say no” to a hostile tender offer. Section 189 of the Companies Act provides that fully paid-up shares may be transferred without restriction. To this extent, unless there is a restriction in terms of the Companies Act, the articles of the company or any subsisting shareholders’ agreement, the shareholders are free to transfer their shares and the directors cannot prevent it by just saying no.

Litigation in connection with M&A deals is generally not common in Zambia. Parties to M&A deals usually provide for arbitration as the preferred dispute resolution mechanism owing to, inter alia, the lengthy nature of litigation in Zambia. However, litigation in connection with M&A deals may potentially arise against regulators where the regulator does not grant the necessary approvals for the M&A deal.

Litigation against regulators would normally occur at approval stage, ie, where an application for approval of the M&A deal is rejected by the regulator.

As the COVID-19 pandemic began to significantly spread in Zambia in early 2020, a key aspect that began to be scrutinised between parties with pending transactions was the extent of force majeure clauses and whether the clauses were sufficiently drafted to excuse performance of obligations by a party. As such, the spread of the COVID-19 pandemic underscored the need for properly drafted force majeure clauses with parties to M&A deals seeking to widen the scope of force majeure clauses to cover the disruptions caused by the COVID-19 pandemic.

Shareholder activism is an important force in the corporate governance of companies in Zambia. Zambian law provides for mechanisms under which shareholders including minority shareholders can protect their interests. These mechanisms include the right of a shareholder to request the High Court for an appropriate order on the ground that the affairs of the company are being conducted in a manner that is oppressive. The focus of shareholder activism is usually on corporate governance and financial matters of the company.

In most cases, the objectives of activists are financial in nature. As such, activists would tend to encourage the entry of a company into M&A transactions or spin-offs if they are able to negotiate a higher financial consideration for the transaction.

Interference with the completion of announced transactions would usually arise where the activists are not satisfied with the terms and conditions of a transaction, which are mostly financial in nature. In Zambia, shareholders generally have overriding authority over the affairs the company and consequently over the decisions of the board of directors. As such, shareholders are able to use their overriding authority to interfere with the completion of transactions. However, it is uncommon for activists to interfere with the completion of announced transactions in Zambia.