CLLS and Law Society publish specimen documents ahead of takeover and mergers reform

CLLS and Law Society publish specimen documents ahead of takeover and mergers reform

A Joint Working Party of the Company Law Committees of the CLLS (CLLS) and the Law Society of England and Wales (Law Society) (the Joint Working Party) has published specimen documents to reflect the changes to the City Code on Takeovers and Mergers (Code), which come into effect on Monday 5 July 2021. This follows the Takeover Panel (Panel) confirming in March 2021 that it would be proceeding with amendments to the Code relating to the treatment of offer conditions and the offer timetable. The amended Code applies to all firm offers which are announced on or after 5 July 2021 (implementation date), except where to do so would give the amendments retroactive effect. Any ongoing firm offers which straddle the implementation date, and any offers announced on or after the implementation date which are in competition with such ongoing offers, continue to be subject to the unamended provisions of the Code.

The specimen documents comprise (i) a revised set of offer conditions; (ii) further terms of the offer; and (iii) wording for an acceleration statement. The Joint Working Party has also prepared a memorandum describing potential approaches for addressing cash confirmation exercises in light of the guidance from the Panel that financing arrangements for offers and schemes should continue beyond the stated contractual long-stop date of the offer/scheme. 

The specimen documents and memorandum have been published on the CLLS and Law Society websites

The specimen documents have been published subject to certain disclaimers by the Joint Working Party, including that: (a) the specimen documents are intended as illustrative examples only; (b) that the memorandum reflects the views of the Joint Working Party; and (c) that the specimen documents and the memorandum are not prescriptive or comprehensive and are not intended to be, and should not be relied upon as being, legal or regulatory advice.

For further details on the Code changes, see News Analysis: Analysing the Takeover Panel’s proposed changes to the offer timetable and offer conditions and Panel confirms proposed changes to the offer timetable and offer conditions.

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About the author:
Darius is a corporate lawyer with experience in advising public and private companies on domestic and cross-border M&A, joint ventures, equity capital markets, corporate governance, company secretarial matters and general corporate work. Darius spent 20 years working in private practice in the City of London, including six years as a corporate associate at Allen & Overy and several years as a partner at a leading national law firm (with a secondment to a leading Japanese investment bank).