UK: Takeover Code Consultation - Distribution Of Information During An Offer

Last Updated: 15 March 2016
Article by Nick Heap

The Code Committee of the Takeover Panel has published a consultation paper containing some proposed changes to the City Code on Takeovers and Mergers (the "Code") relating to the manner in which information and opinions are communicated and distributed by, or on behalf of, a bidder or target company during the course of an offer. These changes are mainly being introduced in order to clarify how the Code is currently interpreted in practice and are unlikely to result in a significant change in how offers are conducted.

The proposed changes are designed to reinforce the existing key requirements under the Takeover Code for the shareholders of the target company to be treated equally and for them to be given sufficient time and information to enable them to reach a properly informed decision on a bid. They also reflect the way in which communications are now made through social media, the internet or other electronic means. 

Key proposed changes:

  • Rule 20.1(b) (Information and opinions) - the existing provisions in Rule 20.1 relating to information about parties to an offer are to be enhanced so that any material new information or significant new opinion relating to an offer, or a party to an offer, which is (a) published by, or on behalf of, a bidder or target (other than in a document sent to target shareholders) (b) provided by, or on behalf of, a bidder or target to the media; or (c) provided by, or on behalf of, a bidder or target to any shareholder in, or other person interested in any securities (including debt securities), of a bidder or target, or to any investment manager, investment adviser or investment analyst ("Relevant Person") must, at the same time, be published in an announcement via a regulatory information service ("RIS").
  • Rule 20.1(c) (Shareholder presentations and media communications) – copies of any presentation or other document relating to an offer which is provided to a shareholder or Relevant Person, or which is used in any meeting with such persons or any written communication relating to an offer or party to an offer provided by or on behalf of the bidder or target must be published on a website promptly after it is provided, used or published by the media. Where there are multiple versions of a presentation or other document then only the latest version needs to be published, provided it does not omit any relevant information included in a previous version. The proposals will allow information to be supplied to a shareholder or Relevant Person prior to the commencement of an offer period or, with the consent of the Panel, during the offer period but prior to the announcement of a firm or revised offer, provided the information is then published by no later than the date of the announcement of the firm or revised offer or, where the information is provided by a target board which is not recommending the offer, the first substantive announcement made by the board following the offer.
  • Rule 20.2 (Meetings and calls with shareholders and others) - a new rule will be introduced in order to require financial advisers or corporate brokers to the bidder or target company to supervise any meetings or telephone calls that take place (a) prior to the offer period where the meeting or call relates to a possible offer; (b) during the offer period but prior to the announcement of a firm offer; or (c) after the announcement of a firm offer, but normally only where the offer is not recommended by the board of the target or if there is a competitive situation. The relevant financial adviser or corporate broker who supervises the call would be required to provide a written confirmation to the Panel that no material new information or significant new opinion was provided at the meeting or on the call. The Code Committee recognises that in certain circumstances it may be appropriate to relax this requirement and is proposing to replace the current note 3 to Rule 20.1. The new Rule 20.2 would, with prior consultation with the Panel, not require a financial adviser or corporate broker to supervise a meeting or telephone call following the announcement of a firm offer which is recommended by the target board and where there is no competitive situation. In such cases, a senior representative of the bidder or target itself who attended the meeting or telephone call would be permitted to confirm in writing to the Panel that no material new information or significant new opinion was provided during the meeting or telephone call.
  • Rule 20.3 (Videos) - a new rule will be introduced in order to restrict the use of social media and videos. Videos published by a bidder or target company which include any information or opinions relating to an offer, or a party to an offer, must have the prior consent of the Panel and broadly comprise only a director or senior executive reading from a script or participating in a scripted interview. The video should, at the same time, be published on a website and an announcement made via a RIS that the video has been published and which RIS also contains a link to the website.
  • Rule 20.4 (Social media) - a new rule will be incorporated into the Code in order specifically to prevent the publication of any bid information through social media (e.g. Twitter or Facebook), unless it includes the full text of the information and opinions that are published by a party by means of a RIS announcement or website in accordance with the provisions of the Code (or a basic notification of a link to the website on which such an announcement or document has been published). The Code Committee emphasises that any information or opinions published by social media need to comply with the standards of care and presentations in Rule 19.1.
  • Rule 19.4 (Advertisements) – the Code Committee is proposing to amend Rule 19.4 in order to  broaden the scope of the current prohibition on advertisements that are connected with an offer or potential offer to include all advertisements that are published during the course of an offer. This is intended to avoid potential confusion arising from the Rule prohibiting advertisements which are "connected with an offer" and then providing exceptions from advertisements that have no bearing on an offer.

Comments on the amendments to the Code proposed in the consultation paper should be provided to the Code Committee by no later than 15 April 2016.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions