Amalgamation or absorption? Here’s the Ethiopian roadmap from plan to registration.
Merger and Acquisition (M&A) operations are regulated through structural provisions in the 2021 Commercial Code and the Trade Competition and Consumer Protection framework.
Legal Structures
Ethiopian corporate codes recognize two primary transaction methods:
- Amalgamation: Participating companies dissolve, transferring assets to a newly formed share company.
- Absorption: The target company is dissolved, and its assets are absorbed by the surviving acquirer.
Trade Ministry (MoTRI) Notification Tiers
Before completing an acquisition, firms must evaluate financial notification thresholds based on combined asset or transaction values:
- Small (Below ETB 30 Million): Post-transaction notification required.
- Intermediate (ETB 30 – 300 Million): Notification and assessment phase prior to implementation.
- Large (Above ETB 300 Million): Comprehensive pre-merger assessment phase required.