This article provides expert insight into the rules across several jurisdictions in relation to public M&A transactions, a look at offer structure and indicative timelines, and provides answers to the most commonly asked key commercial questions.
The UK Takeover Code (the Code) is the principal source of regulation for public M&A transactions in the UK.
The Code is issued and enforced by the Panel on Takeovers and Mergers (the Panel) and regulates offers for companies which have their registered offices in the UK, the Channel Islands or the Isle of Man if any of their securities are admitted to trading on a UK regulated market, a UK multilateral trading facility (such as AIM) or a stock exchange in the Channel Islands or the Isle of Man.
Different types of Offers for companies regulated by the Code can be implemented using a number of structures. The most commonly used structures—contractual takeover offer pursuant to Part 28 of the Companies Act 2006 (the Act) and a members’ scheme of arrangement pursuant to Part 26 of the Act—are explained in detail.
Secrecy and announcements, disclosure of interests and stakebuilding, and cash confirmation requirements are also explained.
In considering the US regulation of public M&A transactions, the authors explain that it is important to understand that the US regime can apply whenever the target has shares that are beneficially held by US residents.
In other words, the target does not have to be a US company for the US rules to apply and, in the case of a publicly traded company, chances are there will be at least some US beneficial holders.
Therefore, it is generally considered prudent to assume the US rules will apply to any public M&A transaction and to consider the implications at the outset.
The authors explain different transaction structures in the US deals in great detail and include insights into the commercial, tax, legal and other considerations.
Public M&A rules and requirements in Australia, Belgium, China, Germany, Hong Kong, Indonesia, Italy, Japan, Luxembourg, Spain, Sweden are addressed in the full article.