The third edition of ‘Takeovers Law & Strategy’, the definitive guide to the laws, procedures and strategies relevant to takeover bids in Australia, was launched last night at Freehills in Melbourne by Simon McKeon, President of the Takeovers Panel.
The authors, Freehills corporate partners Rodd Levy and Neil Pathak, also presented a thought-provoking discussion paper entitled ‘Improving Efficiencies in Takeovers’ outlining six key proposals for law reform in the area.
‘Australia needs a general review of its takeovers laws to ensure our laws best promote the economic benefits that takeovers can deliver,’ said Levy. ‘This is even more the case in these challenging economic times.’
The six proposals for reform suggested by Levy and Pathak are:
- There should be greater freedom for persons who already control 50% of a company to acquire further shares. The law should focus only on transactions for a change of control.
- All bids should be subject to a mandatory 50% minimum acceptance condition, so control only passes at a price acceptable to the majority of shareholders.
- The prohibition against escalator agreements should be repealed to allow top up payments equal to a subsequent bid price.
- Transactions between bidders and shareholders which are linked to a bid should be facilitated where the transaction is dependent on other shareholders acceptances.
- The rules governing the bid timetable should be reformed to avoid takeover bids dragging on unnecessarily and bring matters to a head more quickly.
- We should build on the success of the Takeovers Panel by conferring on it additional powers to grant exemptions, modifications and give advance rulings.
‘If adopted these proposals will help bring Australian takeovers law in line with other jurisdictions including London and Hong Kong,’ said Pathak. ‘The aim is to make takeovers in Australia more efficient and to have a positive effect on the market, and ensure that our takeover rules are consistent with major overseas jurisdictions so that foreign companies are not discouraged from investing in Australia by unduly restrictive laws.’
Takeovers Law & Strategy contains a comprehensive analysis of each step involved in a takeover bid and the relevant requirements under the Corporations Act, the Foreign Acquisitions and Takeovers Act, the Listing Rules of the Australian Securities Exchange, the Trade Practices Act and other relevant legislation.
In launching the book, McKeon said ‘The takeovers community has long relied on Takeovers Law & Strategy for its succinct summary of key issues in takeovers. The new edition deserves a place on the bookshelf of all legal and investment banking advisers, not to mention corporate executives who become involved in takeover activity, whether as bidder or target.’
A new third edition of the book was required due to the vast changes in takeovers practice and strategies since the last edition was published in 2002. This has included approximately 200 decisions of the Takeovers Panel.
The topics featured in the book include:
- strategic planning for a bid;
- foreign bidders, anti-competitive bids and acquisitions in regulated industries;
- the involvement of insiders in a bid;
- action and tactics during the offer period;
- long-term defensive strategies;
- disclosure of shareholding interests;
- compulsory acquisitions; and
- dispute resolution before the Takeovers Panel.
Rodd Levy and Neil Pathak are partners of Freehills and have extensive experience in all aspects of takeover bids, takeover defences, schemes of arrangement and other public company transactions.
The latest edition of ‘Takeovers Law & Strategy’ is available from the Lawbook Co. on 1300 304 195 or through its eStore.
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