Company takeovers chapter in 'The Laws of Australia' updated

A revised version of the company takeovers chapter of The Laws of Australia, one of Australia’s leading legal encyclopedias, has recently been published.

The revised version was co-authored by Melbourne-based Partner Rodd Levy and Senior Associate Simon Walker.

The chapter sets out a succinct summary of:

• the Corporations Act provisions which regulate making and responding to a takeover bid;
• fundamental concepts in the legislation such as ‘voting power’, ‘relevant interests’ in shares and ‘associations’ between persons; and
• relevant ASIC and Takeovers Panel guidance.

Attention is also given to other aspects of the Corporations Act that are particularly relevant to takeovers, including compulsory acquisition, the disclosure of substantial shareholdings and insider trading.

Publication of the revised version is timely.

We have recently seen a resurgence in the use of takeover bids in some interesting circumstances — for instance, Kin Group’s bid for Pact, Brett Blundy and Ray Itaoui’s bid for Best & Less, ACL’s bid for Healius and Andrew Forrest’s bid for Mincor. These transactions have highlighted some of the key advantages that takeover bids have over schemes of arrangement, including giving the bidder the ability to build a control position relatively quickly and to respond flexibly to changing circumstances (like rival offers).

In addition, the simultaneous takeover and scheme deal structure, which involves the bidder proposing a ‘back up’ takeover bid at the same time as a scheme of arrangement in case the scheme is voted down, shows no signs of going away. CapVest’s bid for Virtus, Alludo’s bid for Nitro and The Access Group’s bid for IntelliHR are some recent examples.

The revised version of the company takeovers chapter is a useful resource for anyone involved in public M&A transactions in Australia. It can be accessed online through Westlaw.

We encourage you to refer to chapter and to contact the authors if you have any questions about the content.