PARAGRAPH 28 PARAGRAPH 28
28.1 VALUATIONS IN CONNECTION WITH A BID
When valuation of assets is provided in connection with an offer, the person providing the valuation must ensure that the valuation is supported by the opinion of an appropriate external and independent valuer.
28.2 INFORMATION TO BE INCLUDED
The person must ensure that such a valuation states:(a) the effective date as at which the assets were valued;(b) the name, professional qualifications and address of the valuer; and(c) if the valuation is not current, that a current valuation would not be materially different.
28.3 WHERE AN UPDATED VALUATION IS REQUIRED
If a statement according with Paragraph 28.2 cannot be made, the Person must ensure that the valuation is updated.
28.4 OPINION AND CONSENT LETTERS
Where a valuation of assets is given in any document addressed to shareholders:(a) the document must include:(i) the opinion of the valuer; and(ii) a statement that the valuer has given and not withdrawn his consent to the publication of his valuation certificate; and(b) the valuation certificate must be made available for inspection in the manner described in together with an associated report or schedule containing details of the aggregate valuation.
Guidance Notes to Paragraph 28
This Paragraph applies not only to land, buildings and process plant and machinery but also to other assets, for example, inventory, ships, aircraft and individual parts of a business. This Paragraph does not apply to an assessment of value carried out merely for the purpose of preparation of financial accounts.
In certain cases, offer documents and Target circulars issued by the Bidder or the Target will include statements of assets reproducing Directors' estimates of asset values published with the entity's accounts. The Panelwill not regard such estimates as "given in connection with an offer" except where asset values are a particularly significant factor in assessing the offer and the estimates are, accordingly, given considerably more prominence in the relevant documents than merely being referred to in a note or appendix to a statement of assets.
In exceptional cases, certain companies, in particular property companies, which are the subject of an unexpected offer may find difficulty in obtaining, within the time available, the opinion of an appropriate external valuer to support an asset valuation, as required by this Paragraph, before the Target circular has to be sent out. In such cases, the Panel may waive strict compliance with this requirement. The Panel will only do this where the interests of shareholders appear on balance to be best served by permitting informal valuations to appear coupled with such substantiation as is available. Targets or their advisers who wish to make use of this procedure should consult the Panel at the earliest opportunity.
Where the Panel is satisfied that disclosure under Paragraph 10.2.1(b) may be commercially disadvantageous to the entity concerned, it may modify these requirements so as to allow the report or schedule to appear in a summarised form. In certain cases, the Panel may require any of these documents to be reproduced in full in a document sent to shareholders.