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GLOSSARY

Compulsory acquisition definition

Published by a LexisNexis Corporate expert

What does Compulsory acquisition mean?

CA 2006, ss 974–991 contains provisions enabling or requiring an offeror, following a takeover offer, to acquire offeree shares for which acceptances have not been received or given under the offer. Also referred to as squeeze-out rights (an offeror’s right to compulsorily purchase the shares of non-assenting shareholders) and sell-out rights (non-assenting shareholders’ rights to require the offeror to purchase their shares), in each case on the same terms as the offer. The exercise of squeeze-out rights is dependent on the offeror having acquired or contracted to acquire at least 90% of the shares to which the offer relates and, if relevant, at least 90% of the voting rights carried by such shares. A minority shareholder may exercise sell-out rights if the offeror acquires 90% of all the offeree shares (and not just those to which the offer relates). These statutory provisions apply to both public and private UK companies wherever there is a 'takeover offer' as defined by the CA 2006. There is no requirement for the offer to be regulated by the Code.

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Bridge to bond facilities

Bridge to bond facilities What are they? A bridge to bond facility is a type of acquisition financing where the buyer requires the certainty of a fully committed financing package, but which is intended to be replaced in the future with a mid- to long-term financing in the form of high yield bonds. In markets where acquisitions typically do not have a financing condition, a bridge financing package (which is available to be drawn if necessary) is often a key component to a successful bid. This Practice Note focuses on bridge to high yield bond financing. However, investment-grade borrowers also commonly use bridge facilities for acquisitions. Bridge commitments for investment-grade borrowers differ in many ways, including: lower pricing, much less restrictive covenants (the terms often follow the borrower’s existing credit facilities) and the securities demand mechanic may not be included (or if included, it may only be triggered by ratings downgrade). Bridge commitments for investment grade borrowers may also have longer maturities (or extension rights exercisable by...

Compulsory acquisition for NSIPs—introduction and principles

Compulsory acquisition for NSIPs—introduction and principles The Planning Act 2008 (PA 2008) introduced development consent orders (DCOs) for nationally significant infrastructure projects (NSIPs). The regime provides for the grant of compulsory acquisition powers as part of the DCO, with no need to seek separate compulsory purchase order powers for such NSIPs (this applies in respect of development in England. For development in Wales, where compulsory acquisition is required for associated development, a separate compulsory purchase order will still need to be promoted). This Practice Note sets out the overall principles and considerations that an applicant should take into account in considering whether to seek powers of compulsory acquisition in its DCO application. See also Practice Notes: • Compulsory acquisition for NSIPs—application, draft DCO and supporting documentation • Compulsory acquisition for NSIPs—examination, making the DCO, costs, implementation and material change applications • Compulsory Acquisition for NSIPs—special categories of land, associated development and additional land • Rights of entry under section 53 of the Planning Act 2008 Relevant provisions of...

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