This should explain it.26 May 2022 20:59
Rule 9 of the Takeover Code requires a general offer to be made to the holders of any class of equity share capital and also to the holders of any other class of transferable securities carrying voting rights in a company which is subject to the Takeover Code (unless the Takover Panel consents otherwise) when:
Any person acquires an interest in shares which, together with shares in which persons acting in concert with that person are interested, carry 30% or more of the voting rights of the company; or
Any person, together with persons acting in concert with that person, is interested in shares which carry between 30% and 50% of the voting rights of such a company, and such person, or that person’s concert parties, acquires an interest in any other shares which increases the percentage of shares carrying voting rights in which that person is interested.
An offer under Rule 9 must be made in cash and at the highest price paid by the person required to make the offer, or any person acting in concert with that person, for any interest in shares of the company during the 12 months prior to the announcement of the offer.
Except with the consent of the Takeover Panel, a Rule 9 offer can only be conditional on the bidder receiving acceptances to give it, and persons acting in concert with it, more than 50% of the target’s voting rights.
Can the obligation to make a mandatory offer be waived?
There are a number of circumstances in which the Takeover Panel may grant a dispensation from the obligation under Rule 9.1 to make a general offer to all the shareholders of a company:
Where the formal whitewash procedure applies in certain circumstances as set out in the Notes on Dispensations from Rule 9 and Appendix 1. This requires a vote by independent shareholders.
The Takeover Panel may also grant a waiver of Rule 9 in certain other situations such as rescue operations where a company is in such a serious financial position that it can only be saved by an urgent issue of new shares or where shares or other securities are charged as security for a loan and, as a result of enforcement of the security, a lender would incur an obligation to make a general offer under Rule 9.1 and certain other limited circumstances.
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