| Commentary

212 Introduction

| Commentary

5: COMPULSORY PURCHASE

212 Introduction

Whether an offeror is bidding to take over a private or a public company, its aim will usually be to secure 100% of the target’s shares. In practice, however, it is unusual for an offeror to achieve a 100% acceptance rate, and the Companies Act 20061 provides a procedure for an offeror to compulsorily purchase the shares of non-assenting shareholders (squeeze-out rights) and for non-assenting shareholders to require the offeror to purchase their shares (sell-out rights); in each case on the same terms as the offer.

The exercise of squeeze-out rights by an offeror is dependent on

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