The Review and Approval Process of Offer Documents and Independent Advice Circulars (IACs) relating to Take-Overs And Mergers (TOM) Offers in Malaysia
The SC evaluates proposals which have offer implications under Division 2 of Part VI of Capital Markets and Services Act 2007 and the Malaysian Code on Take-overs and Mergers 2010 with the objective of ensuring full compliance with the laws, guidelines and practice notes. As such, the TOM department will review offer documentations, comprising clearance of disclosure in offer documents, letters from the board of companies being taken over (offeree board letters) and IACs, and processes applications involving listing of corporations, reverse take-over and transfer of listing under the equity requirement for public companies.
The offer documents and IACs are to comply with the minimum disclosure requirements as provided for in Schedule 1 and Schedule 2 of the Malaysian Code on Take-Overs and Mergers 2010 (the Code) and Guidelines on Contents of Applications relating to Take-overs and Mergers. These documents and the offeree board letters have to obtain consent from the Securities Commission (SC) before issuance.
Persons intend to be appointed as independent advisers for the preparation of the IACs would need to comply with Paragraph 1.4 of Practice Note (PN) 15 of the Code which sets out the standard on the independence of an adviser. The objective of the requirement is to ensure that the adviser is independent and the shareholders of the offeree receive fair advice to assist them in making a decision on the take-over offer. No approval from the SC is needed for the appointment of the independent advisers.
Draft offer documents are to be submitted to the SC within 4 days after the offerors’ take-over offer announcements. The SC will complete its review of the offer documents within 16 days to allow time for printing. All in all, the dispatch of the offer documents to offeree shareholders will have to be done within 21 days from take-over offer notices . The offeree board letter and the IACs will be dispatched within 10 days subsequent to the dispatch of the offer documents.
As part of the business processes, the SC always engages with relevant stakeholders, i.e. principal advisers and ministries/government agencies, to ensure that there are thorough, consistent, transparent, efficient and timely delivery of our services to the market.