SINGAPORE Law and Practice Contributed by: Terence Quek, Benjamin Cheong, Hoon Chi Tern and Favian Tan, Rajah & Tann Singapore
the default alternative, provided that the target is seeking to delist from the SGX. 10.3 Producing Financial Statements Under the Takeover Code, the offer document must contain specified information on the offeror – regardless of whether the offer consideration is in cash or stock. This information includes: • details of turnover; • exceptional items; • net profit or loss before and after tax; • minority interests; • net earnings per share and net dividends per share; and • a statement of the assets and liabilities shown in the most recent published audited accounts. In a stock-for-stock transaction (or securities exchange offer), additional information relating to the offeror’s shareholdings will need to be included in the offer document. Public companies are required to adopt the Sin- gapore Financial Reporting Standards (Interna- tional), which are Singapore’s equivalent of the International Financial Reporting Standards. 10.4 Disclosure of Transaction Documents Copies of all public announcements and all doc- uments that have a bearing on a public takeover transaction must be lodged with the SIC at the time when they are made or dispatched.
duties under the Companies Act. Generally, under Singapore law, directors’ duties are to act in good faith and in the best interests of the com- pany. In addition, the Companies Act provides that directors should consider: • the interests of the company’s employees generally; • the interests of its members; and • the rulings of the SIC on the interpretation of the Takeover Code’s principles and rules. Duties Under the Takeover Code Directors have an obligation under the Takeover Code to ensure compliance with the code. Every director of the target company has an obligation to fulfil their duties under the Takeover Code, even if conducting the offer is delegated to indi- vidual directors or a committee of directors. As mentioned in 6.10 Types of Deal Protection Measures , under the Takeover Code, the board of the target company must not take any action that could result in: • any offer being frustrated; and • the shareholders of the target company being denied an opportunity to decide on the merits of the offer. Furthermore, directors have a duty to obtain competent advice on any offer and make such advice known to their shareholders. 11.2 Special or Ad Hoc Committees Although it is common for the executive directors of the target company to take a more active role in managing the takeover process, all directors have an obligation to ensure compliance with the Takeover Code during the process. Although it is not necessary for boards to establish special or ad hoc committees in order to address conflict-
11. Duties of Directors 11.1 Principal Directors’ Duties
In a business combination, directors have fidu- ciary duties under common law and statutory
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