Overview

Revisions to the Takeover Code relating to bidder intention statements and employee information rights became effective on 19 September 2011, following a year-long review of the rules by the Takeover Panel. One key driver for this review was a high-profile takeover in 2010 where the bidder came under significant criticism for its decision, a week after the takeover, to close a UK site (and layoff a number of employees) when the offer document and related statements by the bidder's management had stated the bidder's intentions to continue to operate the site and preserve the associated jobs.

Among other reforms, the revised Takeover Code now includes amendments that are intended to provide greater recognition of the interests of the target's employees in a takeover scenario. The revised Takeover Code seeks to achieve this through a two-pronged approach:

• by requiring better disclosure by the bidder of its intentions regarding the offeree/target's employees; and


• by improving the ability for employee representatives of the target to give their views in relation to a proposed takeover.

In this briefing, Latham & Watkins look in detail at these principle changes, the risks involved and what's next for the Code.

Click ‘View Briefing' to read on.