High Court ruling on reimbursement of Abano takeover expenses
Published 1 May 2018
On 27 April 2018, the High Court delivered a ruling on the reimbursement of expenses related to the unsuccessful partial takeover attempt of Abano Healthcare Limited (Abano) by Healthcare Partners.
The High Court ruled that Abano could recover all of the costs it sought to recover from Healthcare Partners following its failed takeover of Abano in 2017.
Following recent amendments to the Takeovers Act 1993, the jurisdiction over future costs disputes will move to the Takeovers Panel. Rule 49 of the Takeovers Code, which provided for directors of a target company and the company itself to be reimbursed for any properly incurred expenses after a failed takeover, has been replaced by sections 47-53 of the Takeovers Act. Prior to this change, disputes about reimbursements were adjudicated by the District Court or High Court, although these were often settled out of court.
Andrew Hudson, the Takeovers Panel’s Chief Executive said:“The High Court’s decision provides clarity in deciding future disputes. The Panel will carefully consider the Court’s decision and determine whether amendments to the Panel’s 2017 Guidance Note on the Process of Cost Reimbursements under the Takeovers Act are appropriate. In the meantime, market participants should contact the Panel executive with any questions about such disputes.”