• "Sell-out"

    • 35. Right of minority shareholder to be bought out by bidder

      (1) Subsections (2) and (3) apply in a case where a takeover offer relates to all the shares in a company.

      For this purpose a takeover offer relates to all the shares in a company if it is an offer to acquire all the shares in the company within the meaning of section 26.
      (2) The holder of any voting shares to which the offer relates who has not accepted the offer may require the bidder to acquire those shares if, at any time before the end of the period within which the offer can be accepted —
      (a) the bidder has by virtue of acceptances of the offer acquired or unconditionally contracted to acquire some (but not all) of the shares to which the offer relates, and
      (b) those shares, with or without any other shares in the company which he has acquired or contracted to acquire (whether unconditionally or subject to conditions being met) —
      (i) amount to not less than 90% in value of all the voting shares in the company (or would do so but for section 42), and
      (ii) carry not less than 90% of the voting rights in the company (or would do so but for section 42).
      (3) The holder of any non-voting shares to which the offer relates who has not accepted the offer may require the bidder to acquire those shares if, at any time before the end of the period within which the offer can be accepted —
      (a) the bidder has by virtue of acceptances of the offer acquired or unconditionally contracted to acquire some (but not all) of the shares to which the offer relates, and
      (b) those shares, with or without any other shares in the company which he has acquired or contracted to acquire (whether unconditionally or subject to conditions being met), amount to not less than 90% in value of all the shares in the company (or would do so but for section 42).
      (4) If a takeover offer relates to shares of one or more classes and at any time before the end of the period within which the offer can be accepted —
      (a) the bidder has by virtue of acceptances of the offer acquired or unconditionally contracted to acquire some (but not all) of the shares of any class to which the offer relates, and
      (b) those shares, with or without any other shares of that class which he has acquired or contracted to acquire (whether unconditionally or subject to conditions being met) —
      (i) amount to not less than 90% in value of all the shares of that class, and
      (ii) in a case where the shares of that class are voting shares, carry not less than 90% of the voting rights carried by the shares of that class,
      the holder of any shares of that class to which the offer relates who has not accepted the offer may require the bidder to acquire those shares.
      (5) For the purposes of subsections (2) to (4), in calculating 90% of the value of any shares, shares held by the company as treasury shares are to be treated as having been acquired by the bidder.
      (6) Subsection (7) applies where —
      (a) a shareholder exercises rights conferred on him by subsection (2), (3) or (4),
      (b) at the time when he does so, there are shares in the company which the bidder has contracted to acquire subject to conditions being met, and in relation to which the contract has not become unconditional, and
      (c) the requirement imposed by subsection (2)(b), (3)(b) or (4)(b) (as the case may be) would not be satisfied if those shares were not taken into account.
      (7) The shareholder is treated for the purposes of section 37 as not having exercised his rights under this section unless the requirement imposed by paragraph (b) of subsection (2), (3) or (4) (as the case may be) would be satisfied if —
      (a) the reference in that paragraph to other shares in the company which the bidder has contracted to acquire unconditionally or subject to conditions being met were a reference to such shares which he has unconditionally contracted to acquire, and
      (b) the reference in that subsection to the period within which the offer can be accepted were a reference to the period referred to in section 36.
      (8) A reference in subsection (2)(b), (3)(b),(4)(b), (6) or (7) to shares which the bidder has acquired or contracted to acquire includes a reference to shares which an associate of his has acquired or contracted to acquire.

    • 36. Further provision about rights conferred by section 31

      (1) Rights conferred on a shareholder by subsection (2), (3) or (4) of section 35 are exercisable by a written communication addressed to the bidder.
      (2) Rights conferred on a shareholder by subsection (2), (3) or (4) of that section are not exercisable after the end of the period of three months from —
      (a) the end of the period within which the offer can be accepted, or
      (b) if later, the date of the notice that must be given under subsection (3) below.
      (3) Within one month of the time specified in subsection (2), (3) or (4) (as the case may be) of that section, the bidder must give any shareholder who has not accepted the offer notice in the prescribed manner of —
      (a) the rights that are exercisable by the shareholder under that subsection, and
      (b) the period within which the rights are exercisable.
      If the notice is given before the end of the period within which the offer can be accepted, it must state that the offer is still open for acceptance.
      (4) Subsection (3) does not apply if the bidder has given the shareholder a notice in respect of the shares in question under section 31.
      (5) A bidder who fails to comply with subsection (3) contravenes this section.

      If the bidder is a company, every director or other officer of that company who is in default or to whose neglect the failure is attributable also contravenes this section.
      (6) If a bidder other than a company is alleged to have contravened these Regulations by failing to comply with subsection (3), it is a defence for him to prove that he took all reasonable steps for securing compliance with that subsection.
      (7) A person who contravenes this section shall be liable to a fine of such amount the Panel considers appropriate. A penalty may not be imposed on any person under these Regulations in excess of the maximum amount that may be imposed under the ADGM Founding Law.

    • 37. Effect of requirement under section 31

      (1) Subject to section 38, this section applies where a shareholder exercises his rights under section 35 in respect of any shares held by him.
      (2) The bidder is entitled and bound to acquire those shares on the terms of the offer or on such other terms as may be agreed between the bidder and the shareholder.
      (3) Where the terms of an offer are such as to give the shareholder a choice of consideration —
      (a) the shareholder may indicate his choice when requiring the bidder to acquire the shares, and
      (b) the notice given to the shareholder under section 36
      (i) must give particulars of the choice and of the rights conferred by this subsection, and
      (ii) may state which consideration specified in the offer will apply if he does not indicate a choice.
      The reference in subsection (2) to the terms of the offer is to be read accordingly.
      (4) Subsection (3) applies whether or not any time-limit or other conditions applicable to the choice under the terms of the offer can still be complied with.
      (5) If the consideration offered to or (as the case may be) chosen by the shareholder —
      (a) is not cash and the bidder is no longer able to provide it, or
      (b) was to have been provided by a third party who is no longer bound or able to provide it,
      the consideration is to be taken to consist of an amount of cash, payable by the bidder, which at the date when the shareholder requires the bidder to acquire the shares is equivalent to the consideration offered or (as the case may be) chosen.