On 19 May 2020, the Panel published Panel Statement 2020/4 setting out the ruling of the Panel Executive on the takeover bid by Brigadier Acquisition Co Ltd (Bidco) for Moss Bros to be implemented by scheme of arrangement.
In April, Bidco lodged a submission with the Panel Executive setting out the reasons why it believed that, on account of the impact of COVID-19 and related government measures, it should be permitted to invoke various conditions in the Moss Bros scheme document to lapse its bid. The relevant conditions relate to, among other things, material adverse changes in the business and financial position of Moss Bros. For example:
"except as disclosed, since 27 July 2019 there having been: (i) no material adverse change and no circumstance having arisen which would reasonably be expected to result in any material adverse change in the business, assets, financial or trading position or profits, operational performance or prospects of any member of the Wider Moss Bros Group which is material in the context of the Wider Moss Bros Group taken as a whole"
Under Rule 13.5(a) of the Takeover Code:
"(a) An offeror should not invoke any condition or pre-condition so as to cause the offer not to proceed, to lapse or to be withdrawn unless the circumstances which give rise to the right to invoke the condition or pre-condition are of material significance to the offeror in the context of the offer. The acceptance condition is not subject to this provision."
The Panel Executive has held that Bidco failed to establish that the circumstances which give rise to a right to invoke the conditions are of material significance to it in the context of its offer, as required by Rule 13.5(a). As a consequence, Bidco is not permitted to invoke any of the conditions at the current time. Bidco has been given a short period in which to decide whether to request a review of the Panel Executive's ruling by the Hearings Committee of the Panel.
Although the Panel Executive's reasoning has not been made public, it is unsurprising, given the similar stance taken by it in the past, notably in relation to WPP's 2001 offer for Tempus. In that case, in its comments on the circumstances entitling an offeror to withdraw its takeover offer on the basis of a MAC condition, the Panel stated that they would need to be of "very considerable significance, striking at the heart of the purpose of the transaction in question, analogous … to something that would justify frustration of a legal contract". Although the Panel clarified in a later statement that an offeror would not need to show legal frustration, it reiterated the first part of the test.
"condition" - Google News
May 22, 2020 at 11:32AM
https://ift.tt/2WTR5VK
Takeover Panel decision on MAC condition in offer document - JD Supra
"condition" - Google News
https://ift.tt/2W6ON50
https://ift.tt/2L1ho5r
Bagikan Berita Ini
0 Response to "Takeover Panel decision on MAC condition in offer document - JD Supra"
Post a Comment