The UK Takeover Panel has recently published two Notes to Advisers. These provide guidance in relation to certain types of transactions which are subject to the Takeover Code and statements which are required by the Takeover Code.  

The first note is intended to assist advisers preparing Rule 2.8 statements (see Note to advisers in relation to Rule 2.8 statements). A Rule 2.8 statement is a statement by a bidder that that it does not intend to make an offer for a company which is subject to the Takeover Code. 

The second relates to the disclosure of information in accordance with Rule 9 of the UK Takeover Code (see Note to advisers in relation to the disclosure of information on Rule 9). Rule 9 sets out the requirements for a mandatory cash offer (often referred to as a "Rule 9 offer"). 

Rule 2.8: no intention to bid statements

Rule 2.8 imposes various restrictions on a person who has made a statement that it does not intend to make an offer for a company which is subject to the Takeover Code.

These restrictions apply to the person making the statement, and any person who acted in concert with that person, for a period of six months from the date of the statement although the Panel may grant a dispensation from this general rule. 

A person making a Rule 2.8 statement can specify in that statement certain circumstances in which the no bid statement may be set aside. Note 2 on Rule 2.8 sets out the circumstances that a person can specify as being circumstances in which a Rule 2.8 statement may be set aside. These differ depending on whether a third party has announced a firm intention to make an offer before the Rule 2.8 statement is made. 

To assist advisers, the Panel has prepared two examples of Rule 2.8 statements in relation to situations where, at the time the Rule 2.8 statement is made: 

  • no third party has announced a firm intention to make an offer; and 
  • a third party has announced a firm intention to make an offer. 

The note also reminds advisers that:

  • any person considering making a Rule 2.8 statement should consult the Panel in advance; and
  • any Rule 2.8 statement must be published via a Regulatory Information Service in accordance with Rule 30.1 and should be linked to the Code company to which the Rule 2.8 statement relates.

Rule 9: information to shareholders

Where the Panel is asked to grant a waiver of the obligation to make a mandatory cash offer, shareholders must be given certain information in relation to Rule 9. 

The Panel has prepared some pro forma drafting which can be used when providing such information in relation to Rule 9. The pro forma drafting will need to be amended as appropriate to take account of the particular facts.

The drafting includes:

  • information on Rule 9; and
  • a pro forma "whitewash" resolution.

Advisers should also read the Note to advisers in relation to Rule 9 waiver circulars and complete the checklist when preparing Rule 9 waiver circulars.

If you would like to discuss the UK Takeover Code please contact Nick Graves, Rupert Weston, Dominic Davis, Chris Godfrey or another member of the Burges Salmon Corporate Group.