Thursday 10th December 2015 |
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The Takeovers Panel, which aims to ensure fair and equitable corporate takeovers, wants to prevent co-bidders for a company from skirting requirements under the Takeovers Code.
"The panel has been considering the policy of the Code as it relates to multiple offerors in takeover offers for some time," the Wellington based panel said in its 'Code Word' newsletter. "There have been a number of takeovers where the offerors were current shareholders of the target company and structured the offer vehicle as an unincorporated joint venture, making the offer to all shareholders other than themselves. This has caused the panel increasing disquiet that the policy of the Code may be undermined by these types of offer.
"An offeror that is an unincorporated joint venture should be treated on a basis consistent with an offeror that is an incorporated joint venture."
The unincorporated joint venture needs to become the holder or controller of the voting rights of the joint venture participants, not just aggregate their total shares without any change in ownership status to allow them to reach requirements for 50 percent or 90 percent of shares, the panel said.
"Acquiring the voting rights of the joint venture participants under the offer ensures that no side-deals can be made between co-offerors that would effectively see some shareholders receive a different deal," the panel said, noting that the same terms and considerations should be offered for all shares as part of a takeover offer.
The panel didn't detail the recent takeover offers that had sparked its concern.
BusinessDesk.co.nz
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