Merger And Acquisition Term Sheet Template for the Netherlands

A Merger And Acquisition Term Sheet is your first formal step in structuring an M&A transaction in the Netherlands. This document establishes the essential framework for your deal, outlining key commercial terms while ensuring compliance with Dutch legal requirements before you invest significant time and resources in due diligence and final negotiations.

When do you need this document?

You need an M&A Term Sheet when you're ready to formalize preliminary negotiations for acquiring or merging with a Dutch company. This applies whether you're purchasing shares in a private limited company (BV), acquiring assets, or pursuing a statutory merger under Dutch law. The document becomes essential when parties want to establish mutual understanding on fundamental deal terms including valuation, payment structure, and key conditions before incurring substantial legal and advisory costs. It's particularly crucial in cross-border transactions involving Dutch entities where international buyers need clarity on local regulatory requirements and compliance obligations.

Key legal considerations

Your term sheet must address several critical legal elements specific to Dutch M&A transactions. Include detailed provisions for employee consultation requirements under the Works Councils Act, which mandates specific timelines and procedures for informing and consulting with employee representatives. Address competition law compliance obligations under the Dutch Competition Act, particularly if your transaction meets merger notification thresholds requiring approval from the Netherlands Authority for Consumers and Markets (ACM). Consider corporate governance requirements under the Dutch Corporate Governance Code, especially for transactions involving listed companies. Include robust confidentiality provisions protecting sensitive commercial information, and specify exclusivity periods to prevent the target from negotiating with competing bidders during your due diligence phase.

Legal requirements in Netherlands

Netherlands law imposes specific statutory requirements that must be reflected in your term sheet. Under the Dutch Civil Code Book 2, you must clearly identify all parties with their full legal names and Chamber of Commerce registration numbers. For transactions involving Dutch employees, the Works Councils Act requires advance notification and consultation periods that can extend your transaction timeline significantly. If your deal value exceeds €30 million turnover thresholds, you'll need ACM approval under Dutch competition law, which should be addressed as a condition precedent. For listed companies, the Financial Supervision Act mandates specific disclosure obligations and regulatory approvals. Your term sheet should also address Dutch tax implications, including potential withholding tax on dividends and capital gains treatment, and specify governing law clauses ensuring Dutch courts have jurisdiction over any disputes arising from the preliminary agreement.