This note is not part of the regulations, but is intended to indicate their general effect.
These regulations, which come into force on 1 December 2014, amend the Takeovers Code (the code). The amendments arise out of changes to financial markets legislation and 2 sets of discussion papers issued by the Takeovers Panel (the Panel) and recommendations to the Minister of Commerce in August and November 2012 (relating to disclosure of equity derivative positions and technical amendments to the code). The discussion papers and recommendations are available on the Panel’s website at www.takeovers.govt.nz . Principally, these regulations—
amend rule 24C of the code (which relates to the extension of an offer period if a minimum acceptance condition is satisfied or waived in the final week) so that it applies to any offers that are subject to a minimum acceptance condition, whether that condition is required by rule 23 or not. This amendment gives greater effect to the associated Panel recommendation in August 2012:
amend Schedules 1 and 2, which relate to the information that must be contained in, or accompany, takeover notices, offer documents, and target company statements. The information provided under these schedules enhances transparency in a code-regulated takeover. Currently, the offeror and target company must disclose certain details of equity securities in the target company held or controlled by certain persons. But these schedules have not, in the past, required disclosure or the taking into account of any derivative positions in the target company, even though such positions can enable a person to increase the number of equity securities it holds in a target company.
Accordingly, amendments made to Schedules 1 and 2 by these regulations relate to derivatives for which the underlying is 1 or more equity securities in the target company (each, a specified derivative). Broadly, the effect of these amendments is that,—
for most disclosure purposes, a person with a relevant interest in a specified derivative is generally treated the same as a person who holds or controls equity securities in the target company. The offeror or target company must treat that person as holding or controlling, or as having acquired or disposed of, a certain number of the underlying equity securities. This impacts both on the number of equity securities disclosed for a person, and the people for whom disclosure must be made:
the offeror and target company must disclose both the total number of equity securities held or controlled (or treated as held or controlled) by a person and the composition of that total number; that is, of that total number, the number
“actually” held or controlled, and the number treated as held or controlled. Similar disclosure requirements apply in relation to equity securities acquired or disposed of within a 6-month period leading up to the relevant notice, document, or statement:
Date of notification in Gazette: 4 November 2014.
These regulations are administered by the Ministry of Business, Innovation, and Employment.