media release

IR 03-25 New ASIC policy on takeover relief

Published

ASIC today released an expanded policy on takeover relief, Policy Statement 159 Takeovers: Discretionary powers.

Policy Statement 159 aims to give bidders, targets and holders certainty in complying with the Corporations Act, while maintaining the principles behind takeover regulation. It solves practical problems encountered by bidders and targets during a bid.

ASIC prepared Policy Statement 159 following comments from takeover market participants on policy proposals released in February 2003.

Policy Statement 159 replaces Interim Policy Statement 159. ASIC originally released IPS 159 at the time the Corporate Law Economic Reform Program Act 1999 (CLERP Act) commenced, with the intention of reviewing it after the CLERP Act had operated for a reasonable time.

Significant new policies in PS 159 include:

  • clarifying that a partly-paid share is in the same class as a fully-paid share;
  • class order relief for companies that enter into listing rule escrows with holders. Case-by-case relief for companies or underwriters that enter into voluntary escrows with holders;
  • re-affirming our policy that a company that contrives a rights issue or underwriting so that a person obtains control of the company without making a takeover bid risks an application to the Takeovers Panel for a declaration of unacceptable circumstances;
  • case-by-case relief allowing a bidder to exercise options it has acquired under a takeover bid for the options; and
  • class order relief so that employee share scheme securities that are non-transferable can be compulsorily acquired.

Policy Statement 159 also reflects legislative changes to the Act arising from the CLERP Act and the Financial Services Reform Act 2001.

Copies of PS 159 and related class orders [CO 00/343], [CO 00/344], [CO 00/345], [CO 01/1544], [CO 03/633], [CO 03/634], [CO 03/635] and [CO 03/636] are available from ASIC’s website at www.asic.gov.au, or ASIC’s Infoline on 1300 300 630.

End of release


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