This Advanced Takeover Code course can be presented face to face in-house or via live in-house webinar.
Advanced Takeover Code Course Objectives:
- Examine the key rules in the Takeover Code, which determine when announcements are needed and how the takeover should be conducted
- Understand the rules for the contractual offer and scheme of arrangement structures and their timetables
- Consider the requirements of mandatory and partial offers
- Be appraised of the strategies and tactics which bidders have used to initiate recommended and hostile takeovers
- Look at how bidders have conducted and concluded their takeovers and the rules which affect them
- Appreciate the advantages and disadvantages of the structure chosen for the takeover
- See how target companies have defended themselves both in advance of a bid and during the bid
- Examine the tactics and arguments which both sides employ in hostile bids
Advanced Takeover Code Course Content:
The Takeover Code: Conduct of Offer
- The UK takeover framework
- Legal, UKLA and Takeover Code provisions
Key rules for the conduct of public bids
- When possible/firm offer announcements are required
- Advisers’ responsibilities for announcements
- What is an untoward share price movement?
- Example: De La Rue/Oberthur
- Disclosures following announcements
- Naming and Put Up or Shut Up
- Contents of firm offer
- When can they be subjective?
- When can they be invoked?
- What pre-conditions are possible in firm offer announcements?
- Minimum consideration following market purchases
- No special deals
- Management incentivisation in PTPs
- Frustrating actions and exceptions
- Example: Shire/Takeda
- Squeeze out requirements
- Overview of recent changes to rules
- Types of takeover
- Offer statistics
- Contractual offer timetable
- How hostile offers are played out
- Case study: Blue Circle/Lafarge
- Timetables in competitive situations
- Development of Schemes of Arrangement
- The rules for Schemes and timetable
- Mandatory offer and whitewash requirements and uses
- Partial and tender offers – rules and when they are useful
Public Takeovers: Strategies and Tactics
- Changes in marketplace which have affected takeovers
Bidder Strategies and Tactics
- Buying share stakes in Target
- Advantages of buying share stakes before and during bid
- Risks of buying stakes
- Restrictions on stake-buying and regulatory requirements
- Methods of acquiring stakes
- Case study: Darty/FNAC/Conforama
- Is it worth holding a large minority stake?
- Irrevocable undertakings
- Advantages of holding irrevocables
- Attitude of shareholders
- Hard and soft irrevocables
- Non-binding letters of intent
- Impact of Takeover Code changes
- Return to traditional bid approach
- Effect of 28 day PUSU and naming
- Work which needs to be done before approach
- Friendly negotiations or hostile offer?
- Possible offers and bear hugs
- Case study: Effect of Cadbury/Kraft
- Timing considerations of firm offer announcements and bid
- Speed of bid
- Case study: Intu/Hammerson/Klepierre
- Issues if US shareholders are present
- Structure: Scheme of Arrangements or Offer
- Advantages and disadvantages compared to contractual offer
- Schemes/offers facing shareholder opposition and competitive bids
- Case Study: Countrywide/3i
- Case Study: Dobbies/Tesco
- Case Study: Corus/Tata/CSN
- Cash or share offer?
- Advantages/disadvantages of cash and shares
- Different mixes of consideration
- Cash alternative structures
- Other financing structures
- Means of using foreign shares
- Care with statements
- Price and other future actions
- Post-offer undertakings
- Example: Sky/Comcast/Fox
- Concluding the offer
- When to increase offer
- Are no increase / no extension statements useful?
- Example: SVG/HarbourVest
Target Strategies and Tactics
- Basic arguments for defence
- Directors and advisers’ responsibilities in accepting/rejecting an offer
- Measures before a bid
- Keeping close to market
- Identification of stakes
- Position of pension fund
- Negotiate, open books or make possible offer announcement?
- Effects of a possible offer announcement and timing
- Advantages of an auction
- When should Target refuse to talk?
- When to open up books?
- Case Study: AstraZeneca/Pfizer
- Case Study: Shire/AbbVie
- Forecasts and undertakings
- Profit/dividend forecasts
- Restructuring and valuations
- Share buy-backs and special dividends
- What works best?
- White knight/squire
- Bolster the board
- “Get them before they get you”
Both Sides’ Strategies and Tactics
- Conflicts of interest
- Examining documents/statements
- Case Study: Tactics in hostile takeover of GKN by Melrose
- Financial and managerial arguments
- Direct approach to shareholders/analysts
Background of the Trainer:
The trainer has spent over 20 years in the City advising on a wide range of corporate finance transactions. He now provides corporate finance training courses on takeovers, London listings and other UK market regulation, as well as providing independent corporate finance advice. His courses draw on his extensive technical knowledge and are illustrated with relevant examples from his own experience and recent transactions.
Advanced Takeover Code Course Summary:
This course covers key rules in the Takeover Code regulating takeovers and the bid strategies and tactics that are used in the current marketplace.
The tactical advantage that possible bidders have had in takeovers has changed since the Code Review and the course examines the numerous effects this has had on bidder and target strategies.
Participants will learn how takeovers are conducted from the initial stages to the completion or lapsing of the bid and will gain an understanding of which strategies and tactics have and which have not worked. This is illustrated with examples from many transactions including the recent hostile takeover of GKN by Melrose and the on-going contested takeover of Sky by Disney/Fox and Comcast.
What Redcliffe’s clients are saying about the course:
“The trainer had a good knowledge of the code & how the various takeovers have been implemented”
Legal Counsel, Pinsent Masons
“Good first-hand experience, practical real life examples & updates of recent rules”
Vice President, RBC Capital Markets
“Lead by an experienced market practitioner. Very interesting to hear deal experience of other participants too”
Associate, Latham & Watkins