Corporate weekly highlights—4 January 2018

04 Jan 2018

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This week’s edition of Corporate highlights includes a News Analysis piece on the ruling in the case of Panel on Takeovers and Mergers v King and the FCA’s release of new and updated Listing Rule technical notes.

Public Company Takeovers

Court grants an Order requiring Mr King to make a mandatory offer under the Takeover Code (Panel on Takeovers and Mergers v King)

Corporate analysis: The Court of Session, in Panel on Takeovers and Mergers v King, has ruled in favour of the Takeover Panel by granting an order to require Mr King to comply with the Panel’s rulings in 2017 that he should make a mandatory offer (rule 9 offer) under the Takeover Code (Code) for all the shares in Rangers International Football Club plc (Rangers) not owned by him or by Messrs Letham, Mr Taylor, and Mr Park (members of his concert party).

On 13 March 2017, the Takeover Appeal Board (TAB) published its decision upholding rulings of the Panel Executive and of the Hearings Committee that Mr King acted in concert with Messrs Letham, Taylor and Park to acquire more than 30% of the voting rights in Rangers and, in consequence, had incurred an obligation under the Code to make a mandatory offer at a price of 20 pence per Rangers share for all of the Rangers shares not already held by Mr King and members of his concert party.

The TAB directed that Mr King announce a rule 9 offer by 12 April 2017. However, Mr King failed to comply and on 13 April 2017 the Takeover Panel commenced proceedings in the Court of Session, Edinburgh under section 955 of the Companies Act 2006 (CA 2006) seeking an order requiring Mr King to comply with its rulings.

The Takeover Panel (as petitioner) sought an order under CA 2006, s 955 ordaining Mr King (the respondent) to announce in accordance with the Code, within 30 days of the date of the court’s order, and thereafter make in accordance with the Code, a mandatory offer at a price of 20p per share for all the issued ordinary share capital of Rangers not already controlled by him, Messrs Letham, Taylor, and Park.

For further information, see News Analysis: Court grants an Order requiring Mr King to make a mandatory offer under the Takeover Code (Panel on Takeovers and Mergers v King).

Equity Capital Markets

FCA releases new and updated technical notes on the Listing Rules

In October 2017 the FCA published PS17/22: Review of the effectiveness of primary markets: enhancements to the listing regime, which set out a number of changes to the Listing Rules together with new and amended technical notes. These changes came into effect on 1 January 2018.

The following new technical notes have been published:

Eligibility for premium listing—financial information and the track record requirements (UKLA/TN/102.1)
The independent business requirements for companies applying for premium listing—interpretation of LR 6.4, LR 6.5 and LR 6.6(UKLA/TN/103.1)
Mineral companies (UKLA/TN/427.1)
Property companies (UKLA/TN426.1)

The following technical notes have been amended:

Listing Principle 2—Dealing with the FCA in an open and cooperative manner (UKLA/TN/209.3)
Classification tests (UKLA/TN/302.2)
Cash shells and special purpose acquisition companies (UKLA/TN/420.2)
Scientific research based companies (UKLA/TN/422.3)

For further information, see LNB News 03/01/2018 118. For information on the initial consultation see LNB News 14/02/2017 118.

Additional news—daily and weekly news alerts

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New and updated content

New Precedent

We have added the following Precedent in our Partnerships topic area:

Limited partnership agreement—most favoured nation (MFN) provisions

Dates for your diary

Date	Subjects covered
4 January 2018	The HM Treasury’s consultation in 2015 found significant support for mandatory reporting of energy use, but also highlighted the need for simplification. The government announced at Budget 2016 that it would abolish the CRC energy efficiency scheme after 2019, incorporating the ‘price signal’ into the climate change levy in the form of increased CCL rates from April 2019. Climate change agreement participants would also receive an increased discount from April 2019. The current consultation proposes a simplified reporting framework that will be UK-wide and implemented through the Companies Act 2006 as part of companies’ annual reports. The proposals for mandatory reporting will not, however, apply to the public sector at this stage. For further information, see LNB News 12/10/2017 83 and HM Treasury’s consultation: Reforming the business energy efficiency tax landscape.
8 January 2018	Proposed Takeover Code amendments on asset sales and other matters are effective from 8 January 2018. Following its public consultation earlier this year (PCP 2017/1), the Code Committee of the Takeover Panel (panel) has published a response statement setting out amendments to the Takeover Code (code) relating to asset sales and other matters (RS 2017/1). The Code Committee has adopted the amendments proposed in PCP 2017/1, subject to certain modifications, and the amendments are effective from 8 January 2018. The Code Committee issued PCP 2017/1 on 12 July 2017, which proposed amendments to the code to, among other things, prevent an offeror or potential offeror from circumventing the code by purchasing significant assets of an offeree (see Takeover Panel consults on proposed amendments to Takeover Code, LNB News 12/07/2017 111). The Code Committee has largely adopted those amendments modified following responses from respondents to the consultation. For further information, see LNB News 11/12/2017 106.
8 January 2018	Takeover Panel responds to proposals requiring bidders to make fuller disclosure of takeover plans. Amendments proposed in PCP 2017/2 are effective from 8 January 2018. Following its public consultation on statement of intentions launched earlier in 2017 (PCP 2017/2), the Code Committee of the Takeover Panel has published a response statement entitled ‘Statements of intention and related matters’ (RS 2017/2) (the response statement). The Code Committee has adopted the amendments proposed in PCP 2017/2, subject to certain modifications, and the amendments are effective from 8 January 2018. For further information, see LNB News 11/12/2017 102.
9 January 2018	Public Takeovers: the second of a two-part government consultation proposing new powers to intervene in mergers which raise national security concerns. The second part to the consultation focuses on longer term reforms which would see enhanced scrutiny of transactions which may raise national security concerns, such as increasing the risk of espionage, sabotage, or the ability to exert inappropriate leverage. This part of the consultation closes on 9 January 2018. For further information, see LNB News 17/10/2017 106.