UK Law and Practice Contributed by: Federico Fruhbeck, Alice Brogi, Alex Bluett and Gisele Zouein, Gibson, Dunn & Crutcher LLP
offer the consideration securities to target sharehold- ers, provided the offer is accompanied by a “written statement” setting out certain specified information. It remains to be seen how regulatory and market prac- tice will develop in relation to this requirement. 8.3 Producing Financial Statements Under the Takeover Code, where a bidder is UK incor- porated and its shares are admitted to trading on a UK-regulated market, Alternative Investment Market (AIM) or the Aquis Stock Exchange (AQSE) Growth Market, the offer or scheme document must contain details of: • the website with – (a) its audited consolidated accounts for the last two financial years; and (b) any preliminary statement of its annual results, half-yearly financial report or interim financial information, published since the date of its last audited accounts; and • in a securities exchange offer, any known signifi- cant change in its financial or trading position since the end of the last financial period for which the accounts/reports/interims referenced in the forego- ing have been published (or an appropriate nega- tive statement). For other bidders, the offer or scheme document must contain this information, so far as is appropriate, and such further information as the Takeover Panel may require. Where a prospectus or exemption document is required on a securities exchange offer, there may also be additional requirements in respect of the financial information to be disclosed. 8.4 Disclosure of Transaction Documents A copy of the offer or scheme document will need to be shared with the Takeover Panel (along with accom- panying checklists). In addition, in the case of a secu- rities exchange offer, it will be necessary for the FCA to approve the prospectus or exemption document if such document is required (see 8.2 Prospectus Requirements ).
The Takeover Code also requires various documents to be published on a website in connection with a public takeover including, among other things, any announcement of a possible offer or firm intention to make an offer, any offer or scheme document, irrevo- cable commitments or letters of intent (see 4.12 Irrev- ocable Commitments ), any permitted offer-related arrangements such as co-operation agreements (see 4.6 Deal Documentation and 4.10 Types of Deal Pro- tection Measures ) and any financing documentation. 9. Duties of Directors 9.1 Principal Directors’ Duties The statutory general duties of directors in the UK are to: • act within their powers; • promote the success of the company; • exercise independent judgement; • exercise reasonable care, skill and diligence; • avoid conflicts of interest; • not accept benefits from third parties; and • declare an interest in a proposed transaction or arrangement. The duty to promote the success of the company is to act in a way a director considers, in good faith, would be most likely to promote the success of the com- pany for the benefit of the shareholders as a whole, and in doing so have regard to, among other matters, the likely consequences of any decision in the long term, the interests of the company’s employees, the need to foster business relationships, the impact of the company’s operations on the community and the environment, the desirability of maintaining a reputa- tion for high standards of business conduct, and the need to act fairly regarding shareholders. In general, directors’ duties are owed to the company and not to the shareholders. 9.2 Special or Ad Hoc Committees It is common in the UK for boards of directors to establish a committee with delegated authority in relation to a transaction, particularly once it has been approved in principle by the board.
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