UK Takeover code

Question 1

https://www.cliffordchance.com/content/dam/cliffordchance/PDF/takeover_guide.pdf

Answer 1

https://www.cliffordchance.com/content/dam/cliffordchance/PDF/takeover_guide.pdf

Question 2

What is the main framework of governing takeovers and mergers in the UK?

Answer 2

UK takeover code

Question 3

What is a general rule about how shareholders should be treated?

Answer 3

All holders of target securities of the same class must be afforded equivalent treatment

Question 4

What is the triggers for an untoward movement in a company’s stock price?

Answer 4

10% above the lowest price since an approach has been made to the target OR 5% in a single day

Question 5

What is rule 2.1 of the code?

Answer 5

Basically emphasises secrecy; the panel must be consulted prior to more than six external parties being approached about an offer or possible offer

External parties include potential finance providers or the target’s pension fund trustees

Question 6

If there is evidence of a transaction being leaked, what happens?

Answer 6

Usually, an announcement will need to be made, but this is at the discretion of the takeover panel

Question 7

When is a bidder and a target responsible for making the takeover announcement after a leak?

Answer 7

Bidder - before they have approached

Target - after the approach

Question 8

What are rules 2.4, 2.5, and 2.7s?

Answer 8

2.4 - potential offer
2.5 - firm intention to make offer
2.7 - does not interest to make an offer

Question 9

What is a rule 2.8?

Answer 9

Places restrictions on the person making the announcement of making an offer in the future.

Usually doesn’t let them make an offer for 6 months unless someone else does.