Mergers & Acquisitions

Overview

  • In Australia, takeovers are regulated by legislation (namely the Corporations Act 2001 (Cth)) and regulatory policy. Takeover rules apply to acquisitions of ASX-listed Australian companies, ASX-listed Australian managed investment schemes (i.e. investment trusts), and unlisted Australian companies with more than 50 shareholders.
  • Cyber security issues are intertwined with merger and acquisition (M&A) activity, particularly with respect to the effectiveness of cyber risk due diligence practices, post-merger processes and data transmission procedures.

Background

  • The Corporations Act 2001 (Cth) contains key rules relating to takeovers in Australia (namely, acquisitions of more than 20% of the target listed entity or trust):
    • Part 2D.1, together with case law, regulates directors' duties and powers, especially relevant for the target entity's directors
    • Chapter 5 regulates schemes of arrangement as alternatives to takeover bids
    • Chapter 6 regulates the acuisition of direct and indirect interests in a target entity
    • Chapter 6A regulates compulsory acquisitions
    • Chapters 6C and 6CA regulate shareholding disclosure requirements and continuous disclosure obligations
    • Part 7.10 regulates insider trading and other conduct relating to securities
    • Chapter 6D regulates fundraising, which is relevant for scrip bids
  • ASX Listing Rules and related market operating rules.
  • Competition/anti-trust legislation contained in the Competition and Consumer Act 2010 (Cth) designed to prohibit mergers that have the effect, or are likely to have the effect, of substantially lessening competition in a market.
  • Foreign investment legislation contained in the Foreign Acquisitions and Takeovers Act 1975 (Cth).
  • Industry-specific statutory frameworks, such as the Banking Act 1959 (Cth), Financial Sector (Shareholdings) Act 1998 (Cth), Insurance Acquisitions and Takeovers Act 1991 (Cth), etc.

Regulatory & Policy Framework

Relevant Organisations

Inquiries & Consultations

Industry Materials

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