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Planning to initiate a merger transaction in Singapore? As in any other jurisdiction, it is important to promptly notify government authorities of the transaction. In Singapore, there are no clear deadlines for notification of plans to merge. You can do this at any time before, during or after the completion of the transaction.

If you have already finalized your  merger, it’s better not to delay the notification, since a new legal entity is created on the site of the two companies, and the persons participating in the process are liquidated, and the Commission should be aware of this. In this blog post, we will take a closer look at the M&A procedure in Singapore with an increasing number of companies moving in this region to take advantage of large domestic markets, cheap labour availability and booming infrastructure.

Start of the deal

Using reorganization in the form of a merger, companies solve a number of problems: consolidation of assets and business consolidation, sale or liquidation of a business through a merger.

The selection of a partner or partners for the merger is an extremely important element of the merger process. When choosing, it is necessary to take into account both the compatibility of the companies' strategies and a number of other factors, from the financial situation to the reputation in the market. It is unlikely that a company with a positive reputation that has existed in the market for a long period and has won a significant number of regular customers will want to team up with other "market players" with a controversial reputation, negative customer reviews, and uncertain financial position.

To initiate a SME merger in Singapore, or if the acquirer is an SME, a fee of approximately USD 3,700 is payable.

A merger in Singapore step-by-step

M&A in Singapore are governed by the rules of the Securities Industry Council. For more information, parties wishing to initiate a public takeover bid should contact the Securities Industry Board.

Before embarking on a M&A in Singapore, it is important to know what information should be submitted in Forms.

  1.  Form M1:
    • ownership structure;
    • notification;
    • activities in the merger;
    • market definition and shares;
    • increasing efficiency;
    • additional restrictions, if specified.
  2. Form M2:
    • market conditions;
    • R&D;
    • cooperation agreements;
    • merger consequences including efficiency gains.

Verification lasts 30 business days from the date of submission of the first form. If the Commission deems it necessary, the additional processing time for the application may be extended.

For Singapore-based mergers, members may request one-on-one advice on mergers in Singapore to see if the merger could pose competition concerns. 

Possible sanctions

Those wishing to conduct a merger in Singapore should take into account that the Commission may interfere with an already completed merger. This happens in the case of willful violations or if the parties are not aware of the procedure, which does not negate their responsibility, and they may face financial sanctions.

If it is found that a Singapore merger violates or is likely to violate the law, action will be taken to remedy negative consequences. Measures may include the transaction suspension.

Merger notice in Singapore is voluntary. The participants may, at their own risk, proceed with the transaction without obtaining permission. This applies equally to persons wishing to initiate a foreign merger in Singapore. However, if there are serious reasons to believe that the merger will create competition problems on a national scale, steps can be taken to stop such a merger.

Final word

It is crucial to study the regulation of cross-border mergers before the transaction is completed. Before carrying out such an operation, the parties are to analyze its organizational aspects and legal consequences. Contact our legal professionals to schedule a personal consultation on merger control procedures in Singapore. 

Our company will help you draw up all the necessary documents in full compliance with the requirements of Singapore law. Leave a request by filling out the form below, or contact us in any other convenient way.