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Takeovers Panel chuffed at first year performance


Friday 23rd August 2002

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Market watchdog the Takeovers Panel is chuffed with its performance in its first year of operation.

"Takeovers are taking place in an orderly fashion and investors are being kept well informed," panel chairman John King said.

The panel, appointed last year by the Government to oversee takeover activity on the sharemarket, posted a surplus of $266,000 in the year ended July.

Its main regulatory tool is the Takeovers Code, introduced on July 1 last year.

The new code, modelled on Australian and British takeover laws, aims to level the playing field between large and small shareholders by requiring bidders to make the same offer to all shareholders when their stake in a target company tops 20 percent.

This can be either through a full bid for all the outstanding shares or through a partial offer taking the holding to at least 50 percent -- both of which require the approval of target-company shareholders.

The code marked a milestone in New Zealand securities laws, ending decades of unregulated first-come-first-served takeovers.

Big cases handled by the panel in its first year included the battle between Lion Nathan and Allied Domecq for control of winemaker Montana, the Otago Power sale, and the purchase of a major stake in Seafresh by four buyers deemed by the panel to be acting in concert.

The panel called 10 meetings where it considered parties may not have complied with the Takeovers Act or Code and issued 13 restraining orders.

"The panel has had a successful first year in its role of facilitating and enforcing the code and achieving its policy objectives," Mr King said.

"However, it is still early days. The panel must remain vigilant and identify any adverse developments which occur in the takeovers market."

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