Open offers
Produced in partnership with James Ufland of Slaughter and May and Chris McGaffin of Slaughter and May

The following Corporate practice note produced in partnership with James Ufland of Slaughter and May and Chris McGaffin of Slaughter and May provides comprehensive and up to date legal information covering:

  • Open offers
  • What is an open offer?
  • Matters to consider
  • Restrictions on shares to be allotted and issued
  • Limits on number of shares to be allotted and issued
  • Authority to allot shares
  • Pre-emption rights
  • Statutory pre-emption rights
  • Listing Rules pre-emption rights
  • Disapplying statutory pre-emption rights
  • More...

Open offers

This Practice Note focuses on the key aspects of open offers and the matters that require consideration when an open offer is being carried out by a company either:

  1. admitted to listing on the official list (Official List) of the Financial Conduct Authority (FCA) and to trading on the main market for listed securities of the London Stock Exchange (LSE) (Main Market) (listed company), or

  2. admitted to trading on AIM, a market operated by the LSE (AIM company)

(both a listed company and an AIM company being a company).

It does not cover placings or rights issues. For information on these transactions see Practice Notes: Placings, A guide to cash box placings, Rights issues—key considerations and Rights issue—procedure for a listed company.

What is an open offer?

An open offer is:

  1. an offer made by a company to existing shareholders

  2. to subscribe for or purchase new shares (or other securities) for cash

  3. in proportion to their holdings, ie a pre-emptive offer

The offer price will typically be at a discount to the prevailing share price, however the discount is usually less than that for a rights issue.

Unlike a rights issue an open offer is not made by way of renounceable letter or other negotiable document, ie there is no provisional allotment of shares or trading by way of nil paid rights. As such if a shareholder does not

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