Australian Takeovers Panel

The Australian Takeovers Panel is presently seeking comment on a rewrite of their procedural rules.  The Takeover Panel there is modeled on the UK Takeover Panel.  Comments are due by October 26! 

In May, the Takeovers Panel began to revisit their rules (GN 7) with respect to deal protection measures, no-shops/no-talks, go-shops, asset lock-ups, break fees (limited to around 1% of equity value of the target) and other deal related provisions.  While all this seems familiar to those of us who think about through the lens of Delaware law, some of their approach takes a decidedly British view on takeovers.  For example, their statement on "frustrating actions" puts the shareholders and not the board clearly in the driver's seat (right side, obviously) when it comes to deciding whether or not to accept an offer:

Although it is generally the responsibility of a company’s directors to make company decisions, decisions about control and ownership of the company are properly made by its shareholders. Where a corporate action could frustrate a proposal concerning control or ownership of a company, the Panel will generally require that shareholders be able to determine the control and ownership of the company. The Panel expects that target company directors will act appropriately in such situations and that references to the Panel on these matters will not be common.

Action taken by a target company is likely to frustrate a takeover bid if taking that action has a material effect on the objective of the bid. Such action will usually allow the bidder either to rely upon a condition in its offer, causing the offer to lapse, or allow a bidder not to proceed with a genuine potential offer. 

-bjmq