Takeover Panel amends Rule 31.9 of the Code

United Kingdom
On 16 April 2003 the Takeover Panel announced that the proposals set out in Consultation Paper (PCP12), published on 7 January this year, to amend Rule 31.9 of the Takeover Code would be adopted without amendment. The changes, which are contained in Response Statement 12, took effect immediately.

Rule 31.9 prohibits the target without the consent of the Panel from making announcements about certain significant matters after Day 39 of the offer. The list of matters deemed to be price-sensitive and prohibited by Rule 31.9 has been extended to cover announcements of any "material new information" (such as material acquisitions and disposals) about the target, as well as announcements of trading results, profit or dividend forecasts, asset valuations and proposals for dividend payments. Various consequential amendments have also been made, including changes to Rules 31.5 (no extension statements) and 32.2 (no increase statements) to allow a bidder to reserve the right not to be bound by a no extension or no increase statement if the target announces material new information with the Panel's consent after Day 39; and to allow the Panel discretion to re-set Day 46 to seven days after the release of material new information after Day 39. In a share for share offer, the changes mean that the bidder may not without the Panel's consent announce any material new information (which could increase the value of the securities offered as consideration) after Day 46.

The amendments proposed in the Consultation Paper were described more fully in our Law-Now article published on 24 January 2003. Response Statement 12 can be found on the Panel's website at

For further information please contact Michael Draper (Corporate Partner) by telephone on +44 (0)20 7367 2068 or by e-mail at [email protected] or Peter Bateman (Corporate Professional Support Lawyer) by telephone on +44 (0)20 7367 3145 or by e-mail at [email protected]