Flexibilities for Take-Over Requirements
The Securities Commission of Malaysia (SC) has announced flexibilities in complying with the relevant requirements under the Capital Markets and Services Act 2007 (CMSA) and the Rules on Take-overs, Mergers and Compulsory Acquisitions (Rules) in relation to takeover offers during the Movement Control Order (MCO) period.
Service of Notices & Documents by Offeror & Offeree
- The offeror or board of offeree may provide an electronic copy of the required notices and documents under paragraphs 9.10(5)(b), 11.02(1), 11.03(1), 11.04(1) & 12.03(1)(b) of the Rules and sections 222(1) & 223(2) of the CMSA on the following websites:
- Bursa Malaysia Bhd’s website, if the offeror or the offeree is publicly listed in Malaysia; and
- Securities Commission Malaysia’s website, if neither the offeror nor the offeree is publicly listed in Malaysia.
- The offeror or the board of the offeree (as the case may be) shall send concurrent notification to all offeree shareholders to inform them of the publication of the notice or document on the Bursa’s or SC’s website, providing details of the relevant website (“Summary Notification“), which shall be sent out to shareholders:
- in hard copy form, by post to the shareholders’ registered Malaysian address maintained with Bursa Malaysia Depository Sdn Bhd (Bursa Depository); or
- in electronic form, by e-mail to the shareholder’s e-mail address registered with Bursa Depository, where a shareholder has already opted for electronic delivery.
- Advisers (including independent advisers), offerors and board of offerees must ensure that the Summary Notification are sent out for the purpose of:
- the copy of the written notice under Rule 9.10(1) to be provided to all offeree shareholders [Rule 9.10(5)(b)];
- the publication of the offer document on the website to be provided to all offeree shareholders [Rule 11.02(1)]; and
- the publication of the offeree board circular and independent advice circular on the website to be provided to all offeree shareholders [Rules 11.03(1) and 11.04(1)].
- The Summary Notification must include the relevant information including, but not limited to, the following:
- name of the offeror, ultimate offeror and persons acting in concert;
- name of offeree;
- key terms of the offer, ie the securities to which the offer is extended to, offer price, mode of consideration, important dates on the offer timeline;
- (in the case of a publication of the offer document) a copy of the Form of Acceptance and Transfer and a copy of the Bursa Depository Transfer of Securities Request Form (FTF010) (Bursa Depository Transfer Form);
- (in the case of a publication of an offeree board circular and independent advice circular) a brief summary of the opinion and recommendation by the offeree board and independent adviser;
- a statement requiring shareholders to register their e-mail addresses with Bursa Depository via Bursa Malaysia’s website or via the Bursa Anywhere application, and including a cautionary statement on the importance for shareholders to register their e-mail addresses, as in the event of any further restriction to movement or any other emergency, an electronic documentation and service may be the only mode that can be employed.
Acceptance & Transfer by Offeree Shareholders
Offeree shareholders are to be provided with two methods of sending the duly completed Form of Acceptance and Transfer and Bursa Depository Transfer Form (“Forms“) to the share registrar and the Authorised Depository Agent (ADA) respectively, with clear instructions given to the shareholders:
- via e-mail, to the e-mail addresses provided in the Forms; or
- via post, to the postal address provided in the Forms.
SC encourages offeree shareholders to send the Forms via e-mail to avoid risk of possible delay.
Settlement of Consideration by Offeror
In relation to paragraph 14.01(1) of the Rules, the period during which an offeror must pay the cash consideration to all accepting offeree shareholders is extended from 10 days to 12 days from:
- the date the offer becomes or is declared wholly unconditional, if the valid acceptances are received during the period when the take-over offer is still conditional; or
- the date of the valid acceptances, if the valid acceptances are received during the period after the take-over offer is or has become or has been declared wholly unconditional.
Compulsory Acquisition
For the purpose of complying with section 222(1)(B) of the CMSA pertaining to a copy of a statutory declaration that is required to accompany the notice of compulsory acquisition, the offeror shall:
- submit a declaration to the SC (“Declaration“) confirming that the conditions for the giving of the notice of compulsory acquisition are satisfied; and
- provide a copy of the Declaration together with the notice of compulsory acquisition to the dissenting shareholders.
The flexibility above is available only where the rights to invoke a compulsory acquisition under section 222 of the CMSA arises during the MCO period.
Other than the flexibilities and extension of time above, advisers are reminded to consult with the SC at the earliest opportunity should there be any need for an extension of time to comply with any provision of the Rules due to any anticipated difficulties in complying with the stated timelines during the MCO period. The SC shall assess on a case-to-case basis.
While the above flexibilities are applicable to general offers, the SC may consider according similar flexibilities in other take-over related documents such as whitewash transactions and schemes to which the Rules apply.
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