CODEWORD

The Panel has amended its Guidance Note on Independent Advisers and the Takeovers Code to require additional disclosures to be made by the adviser seeking to be approved as independent for the purposes of preparing a report under the Code. The Guidance Note now also requires the person seeking to appoint the adviser to provide the Panel with a statement on the process undertaken by that person to select the adviser.

The additional requirements are set out in Appendix B of the Guidance Note.

The Panel has made some changes to the Guidance Note on schemes of arrangement and amalgamations under Part 15 of the Companies Act 1993, to make it clear that the Panel can tailor its response to applications for no-objection statements under section 236A of the Companies Act on a case-by-case basis.

The Guidance Note previously indicated that a no-objection statement would be given only for scheme proposals that are accompanied by an independent adviser’s report on the merits of the transaction. However, the amended Guidance Note clarifies that the Panel may waive this requirement in some circumstances. For example, a scheme to return capital to shareholders may exclude a class of shares with a tiny percentage of the company’s total voting rights, and this may “affect the voting rights” of the Code company in a very minimal way. In such cases the Panel may consider the effect to be so small that it would not require an independent adviser’s report as a pre-requisite to providing a no-objection statement.

The Panel encourages scheme promoters to liaise with the Panel executive at the earliest opportunity to discuss proposals on a confidential basis.

The Panel has updated its Guidance Note on Offer Documents to include a reminder that takeover offers must be on the same terms and conditions as those contained in, or accompanying, the takeover notice, with limited exceptions. All changes or additions to the terms and conditions included in the offer must be notified to the target company before the offer document is sent to shareholders. The Panel also reminds offerors that acceptance transfer forms are part of the terms and conditions of an offer and must be sent with the takeover notice.

The Panel has also updated the Guidance Note to provide guidance on due diligence offer conditions. The guidance is about the drafting of due diligence conditions to avoid breaching the Code, and discusses whether a target company can refuse to allow due diligence in light of the prohibition on defensive tactics in rule 38 of the Code.

The Panel has updated its Guidance Note on Upstream Acquisitions to include two case studies, summarising the Panel’s application of its policy:

(a) the proposed acquisition of 100% of the voting rights in Opus Group Berhad, the upstream parent of Opus International Consultants Limited, a New Zealand Code company, by Faber Group Berhad; and

(b) the proposed merger of AMP Limited with the Australasian business of AXA Asia Pacific Holdings Limited.

“...takeover offers must be on the same terms and conditions as those contained in, or accompanying, the takeover notice, with limited exceptions.”