AUSTRALIA Law and Practice Contributed by: Alberto Colla, Keith Tan, Hugh McDonald and Dean Zinn, MinterEllison
Call-In Power Investments not notified to FIRB that may raise national security risks can be reviewed by the Treasurer by means of call-in power. The Treas - urer can “call in” these investments for review for up to ten years after they are completed and decide whether to impose conditions or order divestment. 3. Recent Legal Developments 3.1 Significant Court Decisions or Legal Developments In the public M&A space, Australia’s most sig - nificant legal development in recent years is the heightened use of a dual-track (concurrent) scheme and takeover bid structure. This dual- track structure typically entails a prospective acquirer launching a scheme and a takeover offer concurrently: the takeover offer is priced slightly below the scheme, with the takeover offer being conditional on the scheme vote fail - ing. In this sense, the takeover offer is “Plan B” offer structure, but it is formally initiated at the same time as the slightly higher-priced “Plan A” scheme. This dual-track offer structure is typically used where an existing shareholder of the target – who might emerge as an opposing sharehold - er and/or a competing bidder – holds a stake large enough to potentially vote down the Plan A scheme (noting that a scheme requires the approval of at least 75% of the votes cast), but where that opposing stake is not large enough to defeat a Plan B takeover with a 50.1% minimum acceptance condition. However, this is only a viable option for acquirers prepared to accept the possibility of ending up with less than 100% ownership of the target under the Plan B takeo - ver.
In 2024, the dual-track structure was most nota - bly deployed by Japanese energy generation company J-POWER on its acquisition of renew - able energy developer Genex Power Limited. J-POWER successfully deployed the dual-track structure as a means to circumvent the potential for a major shareholder holding a 19.9% stake in Genex to block a J-POWER acquisition. Other significant legal developments include clarification of the Takeovers Panel’s approach to standstill agreements (see 5.4 Standstills or Exclusivity ), potential reform, among other things, to enhance disclosure in relation to inter - ests held in ASX-listed entities through equity derivatives (see 4.5 Filing/Reporting Obliga- tions ) and the significant changes to Austral - ia’s merger control regime (see 3.2 Significant Changes to Takeover Law ). 3.2 Significant Changes to Takeover Law There are major reforms to Australia’s merger control regime on the horizon, with legislation passed by the Federal Parliament in November 2024, which will overhaul Australia’s existing voluntary informal merger clearance regime and replace it with a mandatory, suspensory regime. Under the reforms, transactions involving the acquisition of shares or assets that meet pre - scribed notification thresholds and other criteria must be notified to the ACCC (subject to lim - ited exceptions). The suspensory nature of the regime prevents parties from closing or taking steps to close a transaction before clearance has been obtained. The new regime will commence on 1 January 2026, with transitional arrangements that allow acquisitions to be notified under the new regime commencing on 1 July 2025.
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