Business Law Section

Consultation paper on proposed revisions to Guidance Note 1 – Unacceptable Circumstances

The submission to the Takeovers Panel in relation to its Consultation Paper on Guidance Note 1 – Unacceptable Circumstances (Guidance Notes) was prepared by the Corporations Law Committee of the Business Law Section of the Law Council.

While acknowledging a diversity in views in the market, the Committee is generally supportive of the revised guidance and considers that it will assist in clarifying market participants’ (and advisors’) understanding of how “truth in takeovers” applies in practice to “last and final” statements.

If a “wait period” is to be prescribed, the Committee considers that four months is an appropriate “wait period” to apply to “last and final statements”.

The Committee considers that the market would also benefit from additional clarification from the Panel in its revised guidance on whether the “wait period” also applies to other types of “last and final statements” (such as “no waiver” and “no extension” statements).

However, the Committee would understand if the Panel decided to limit its guidance on a “wait period” to “no increase” statements at this stage, and leave other “last and final” statements for separate consultation and guidance at another time.

The Committee considers that the market would benefit from the Panel also providing some guidance as to the likelihood of unacceptable circumstances where there is a departure from last and final statements after expiry of the “wait period”.

You can read the full submission below.

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