On 4 March 2015, regulations were published that amend the UK Companies Act 2006 to prevent takeovers being effected by a cancellation scheme of arrangement. This thereby removes the stamp duty saving which had been obtained by coupling the takeover scheme of arrangement with a reduction and cancellation of the target's share capital so as to avoid any transfer of shares under the scheme.
However, the prohibition will not apply where the scheme amounts to a restructuring that inserts a new holding company, provided that "all or substantially all of the members of the company become members of the parent undertaking".
There are transitional provisions aimed at excluding from this prohibition takeovers which, before 4 March 2015, were either "firm" Code offers or non-Code offers the terms of which (including that they would be made by way of a scheme) had been agreed between target and bidder.
The Regulations are available here: http://www.legislation.gov.uk/uksi/2015/472/pdfs/uksi_20150472_en.pdf.
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