SINGAPORE Law and Practice Contributed by: Benjamin Gaw and Joel Tan, Drew & Napier LLC
General Offer General offers for shares in a Singapore public com - pany are regulated under the Takeover Code. General offers take the form of mandatory offers, voluntary offers or partial offers. Mandatory Offer Under the Takeover Code, a bidder is required to make a mandatory offer for all the shares in a Singa - pore public company where the acquisition of shares by the bidder results in the shareholdings of the bidder and any parties acting in concert with it exceeding certain thresholds. The mandatory offer rules under the Takeover Code apply when: • the bidder acquires shares, and this results in the bidder and its concert parties owning 30% or more of the target company’s voting rights; or • where the bidder who, together with its concert parties, holds between 30% and 50% of the target company’s voting rights, and acquires more than 1% of the target company’s voting rights in any six-month period. Voluntary and Partial Offers An offer that does not trigger the mandatory rules under the Takeover Code is a voluntary offer governed by Rule 15 of the Takeover Code. A voluntary offer must be conditional on the bidder and its concert par - ties acquiring more than 50% of the target company. A higher percentage acceptance threshold may be stipulated, subject to the consent of the Securities Industry Council (SIC). A bidder makes a partial offer by making a voluntary offer for a portion of the target company’s shares. All partial offers must be approved by the SIC, and it will generally grant consent for partial offers that do not result in the bidder and its concert parties holding more than 30% of the target company’s voting rights. Scheme of Arrangement A scheme of arrangement under the Companies Act 1967, Section 210 is a legislative procedure that allows a company to be restructured. A scheme is typically organised as a transfer of shares from the shareholders of the target company to the acquirer, and in consideration of the share transfer, the acquirer
pays cash or issues new shares in the acquiring com - pany to the shareholders of the target company. An alternative scheme is where the target company can - cels its existing shares and issues new shares in the target company to the acquirer. To pass a scheme of arrangement, the scheme must be approved by the requisite statutorily prescribed majority at the scheme meeting and must be sanc - tioned by the Singapore High Court. A scheme that has been successfully passed will be binding on all shareholders of the target company. Amalgamation A scheme of amalgamation under the Companies Act 1967, Section 215A-K is a legislative procedure that allows two or more Singapore-incorporated com - panies to amalgamate and continue as one compa - ny. The amalgamated company may be one of the amalgamating companies or a new company, and all property, rights, privileges, liabilities and obliga - tions of each of the amalgamating companies will be transferred to the amalgamated company. The amal - gamation may be carried out without a court order, subject to certain conditions being satisfied, including obtaining the requisite shareholder approvals and the provision of solvency statements by the directors of the amalgamating companies. 2.2 Primary Regulators The primary regulators of M&A activity in Singapore are: • the SIC, which administers the Takeover Code; • the Singapore Exchange Securities Trading Limited (SGX), which administers the listing rules applica - ble to companies listed on the SGX; • the Monetary Authority of Singapore (MAS), which administers the Securities and Futures Act 2001; • the Accounting and Corporate Regulatory Author - ity (ACRA), which administers the Companies Act 1967; and • the Competition and Consumer Commission of Singapore (CCS), which administers the Competi - tion Act 2004.
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