Aim Rule 1411 May 2018 10:59
Reverse takeover
A takeover or acquisition where the target is larger than the bidder with the result that the target shareholders become majority shareholders in the bidder. This term has different meanings depending on its context:
In the context of the Takeover Code, a transaction where a bidder may consequently need to increase its existing issued voting share capital by more than 100%.
In the context of the Listing Rules, where a listed company acquires a business, an unlisted company or assets where any one of the percentage ratios calculated in accordance with Chapter 10 of the Listing Rules is 100% or more or which would result in a fundamental change in the business or a change in the board or voting control of the listed company. In this case, the transaction must be subject to shareholder approval and a circular will be required. The combined group applying for listing will be treated as a new applicant (see Practice note, Listed and public companies: acquisitions).
In the context of Rule 14 of the AIM Rules for Companies, any acquisition(s) in a 12 month period which for an AIM company would:
exceed 100% in any of the class tests (AIM) ;
result in a fundamental change in its business, board or voting control; or
in the case of an investing company, depart materially from its investing policy (as stated in its admission document or approved by shareholders in accordance with these rules).
For further details, see Practice note, AIM: continuing obligations: Corporate transactions.
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