FINANCIAL COMMUNICATION: FRAMEWORK AND PRACTICES - 2019 EDITION

97 8  z MERGERS AND ACQUISITIONS ACQUISITIONS AND DISPOSALS Existence of negotiations and signature of a letter of intent or pre-contractual document If the issuer is in the process of negotiating with a third party concerning an acquisition or disposal, and the conditions for delaying the disclosure of information can no longer be met, particularly if it can no longer guarantee the confidentiality of this information 113 , it must judge whether immediate market disclosure is necessary or timely, depending on the situation, with regard to whether the transaction is material (the materiality of the transaction being assessed particularly in consideration of the criteria discussed in the sub-category entitled “Signature of a firm agreement” ). If the transaction is not material, the issuer’s disclosure of the existence of negotiations is optional and may be made at its complete discretion. If the issuer considers immediate market disclosure to be necessary or timely, the issuer’s release will indicate in practice the purpose of the negotiations, the state of advancement of the negotiations and the partner’s name. In the event of the signing of a pre-contractual document (memorandum of understanding, letter of intent, etc.), the issuer’s communication may, in certain cases, contain a summary of the key provisions of the agreement as well as possible future steps or conditions precedent that should be fulfilled prior to the conclusion of a firm agreement or implementation of the transaction when the issuer judges that market disclosure of this information is necessary or timely. Data room AMF Position/Recommendation no. 2016-08 (section 3.2) sets out the procedures for disclosing insider information prior to the sale of significant stakes in companies listed on a regulated market (“data room” procedures). The AMF recommends that data room procedures only give access to insider information if strictly necessary for the purpose of informing participants about the transaction concerned, and that access to the data room be restricted to signatories of a letter of intent stating their intention to carry out a financial transaction and the viability of the project, and particularly their ability to finance it. Existence of negociations and signature of a letter of intent or pre-contractual document: n L’ORÉAL