On 19 September 2017, the Code Committee of the Takeover Panel issued a consultation paper (PCP 2017/2) seeking views on proposed amendments to the Takeover Code.
The proposed amendments of the Code Committee include:
- Requiring an offeror, when making
statements of future intentions with respect of the target's
business and employees, to make specific statements of intention
with regard to the company's research and development
functions, the balance of the skills and functions of the
company's employees and management and the location of the
company's headquarters and headquarter functions.
Currently, the offeror only has to disclose these statements in its offer document under R24.2; however, the Panel has proposed that the offeror will also have to disclose specific statements of intention upfront in its firm offer announcement. Making these statements a requirement in the R2.7 announcement will assist employee representatives and pension scheme trustees in offering their own opinions on the effects of the bid. - Introducing a requirement that an
offeror must not publish an offer document for 14 days from the
announcement of its firm intention to make an offer without the
consent of the board of the offeree company.
This allows the target more time to prepare their defence to the bid and also increases the period under R5.1 when the bidder is restricted from acquiring interests in the target's voting rights which take it to or above 30% (apart from one shareholder). - Requiring offerors and offeree companies to publish reports on post-offer undertakings and post-offer intention statements given during the course of an offer.
Comments are invited up until 31 October 2017.
The full consultation is available here:
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.
