Greater clarity with amendments to the Takeovers Code, Practice Notes
The market can expect a Take-overs Code of enhanced clarity with the release of the Malaysian Code on Take-Overs and Mergers (Amendment) 2004 and its Practice Notes today.
The amendments which come into effect today are aimed at ensuring greater clarity of various provisions in the Code without substantially changing the thrust and policies of the prevailing regulatory framework for take-overs and mergers.
The Securities Commission (SC) had consulted market professionals and undertaken a study prior to recommending the amendments to the Minister of Finance.
Among others, there is now a new provision in Schedule 1 of the Code which makes it mandatory for every director of the offeror to state that he had taken reasonable care to ensure both the facts and opinions expressed in the offer document were fair and accurate, and that no material facts were omitted. The offer document must also state that each director accepts responsibility accordingly.
The Malaysian Code on Take-overs and Mergers (Amendment) 2004 and the Practice Notes, are available here. Hard copies of the documents can be purchased from Percetakan Nasional Malaysia Berhad.
To enhance the quality of proposals related to take-overs and mergers and to improve the efficiency of the approval process, the SC introduced the format for submissions of proposals early this year. The “Format and Content of Applications under Division 2, Part IV of the Securities Commission Act 1993 and the Malaysian Code on Take-overs and Mergers 1998” which took effect on 1 March 2004 is also available on the SC website.