CHAPTER 6
-
TAKEOVERS
Note: This Chapter only applies to acquisitions of interests in a CCIV if the CCIV is a listed company: see Division
1
of Part
8B.7
.
History
Ch 6 amended by No 8 of 2022, s 3, Sch 2[160] (effective 1 July 2022).
SECTION 602
602
PURPOSES OF CHAPTER
CCH Note:
Section 602 is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
The purposes of this Chapter are to ensure that:
(a)
the acquisition of control over:
(i)
the voting shares in a listed company, or an unlisted company with more than 50 members; or
(ii)
the voting shares in a listed body (other than a notified foreign passport fund); or
(iii)
the voting interests in a listed registered scheme;
takes place in an efficient, competitive and informed market; and
(b)
the holders of the shares or interests, and the directors of the company or body or the responsible entity for the scheme:
(i)
know the identity of any person who proposes to acquire a substantial interest in the company, body or scheme; and
(ii)
have a reasonable time to consider the proposal; and
(iii)
are given enough information to enable them to assess the merits of the proposal; and
(c)
as far as practicable, the holders of the relevant class of voting shares or interests all have a reasonable and equal opportunity to participate in any benefits accruing to the holders through any proposal under which a person would acquire a substantial interest in the company, body or scheme; and
(d)
an appropriate procedure is followed as a preliminary to compulsory acquisition of voting shares or interests or any other kind of securities under Part
6A.1
.
Note 1: To achieve the objectives referred to in paragraphs (a), (b) and (c), the prohibition in section 606 and the exceptions to it refer to interests in
"
voting shares
"
. To achieve the objective in paragraph (d), the provisions that deal with the takeover procedure refer more broadly to interests in
"
securities
"
.
Note 2: Subsection 92(3) defines
securities
for the purposes of this Chapter.
History
S 602 amended by No 61 of 2018, s 3, Sch 2[148] and
[
149] (effective 18 September 2018).
SECTION 602A
MEANING OF SUBSTANTIAL INTEREST
CCH Note:
Section 602A is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
602A(1)
A reference in this Chapter to a
substantial interest
in a company, listed body (other than a notified foreign passport fund) or listed registered scheme is not to be read as being limited to an interest that is constituted by one or more of the following:
(a)
a relevant interest in securities in the company, body or scheme;
(b)
a legal or equitable interest in securities in the company, body or scheme;
(c)
a power or right in relation to:
(i)
the company, body or scheme; or
(ii)
securities in the company, body or scheme.
History
S 602A(1) amended by No 61 of 2018, s 3, Sch 2[150] (effective 18 September 2018).
602A(2)
A person does not have a
substantial interest
in the company, body or scheme for the purposes of this Chapter merely because the person has an interest in, or a relationship with, the company, body or scheme of a kind prescribed by the regulations for the purposes of this subsection.
602A(3)
The regulations may provide that an interest of a particular kind is an interest that may constitute a substantial interest in a company, listed body (other than a notified foreign passport fund) or listed registered scheme for the purposes of this Chapter.
History
S 602A(3) amended by No 61 of 2018, s 3, Sch 2[150] (effective 18 September 2018).
S 602A inserted by No 64 of 2007, Sch 1
[
2].
SECTION 603
603
CHAPTER EXTENDS TO SOME LISTED BODIES THAT ARE NOT COMPANIES
CCH Note:
Section 603 is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
This Chapter applies to the acquisition of relevant interests in the securities of listed bodies that are not companies but are incorporated or formed in Australia in the same way as it applies to the acquisition of relevant interests in the securities of companies.
Note: Section 9 defines
company
and
listed
.
SECTION 604
CHAPTER EXTENDS TO LISTED REGISTERED SCHEMES
CCH Note:
Section 604 is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
604(1)
This Chapter applies to the acquisition of relevant interests in the interests in a registered scheme that is also listed as if:
(a)
the scheme were a listed company; and
(b)
interests in the scheme were shares in the company; and
(c)
voting interests in the scheme were voting shares in the company; and
(d)
a meeting of the members of the scheme were a general meeting of the company; and
(e)
the obligations and powers that are imposed or conferred on the company were imposed or conferred on the responsible entity; and
(f)
the directors of the responsible entity were the directors of the company; and
(g)
the appointment of a responsible entity for the scheme were the election of a director of the company; and
(h)
the scheme
'
s constitution were the company
'
s constitution.
Note 1: Paragraph (g): See subsection
610(2)
.
Note 2: Section
9
defines
voting interest
in a managed investment scheme.
604(2)
The regulations may modify the operation of this Chapter as it applies in relation to the acquisition of interests in listed registered schemes.
History
S 604(2) amended by No 61 of 2018, s 3, Sch 2[152] (effective 18 September 2018).
SECTION 605
CLASSES OF SECURITIES
CCH Note:
Section 605 is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
605(1)
Takeover bids are made for securities within a particular class. Similarly, compulsory acquisition and buy-out rights operate on securities within a particular class.
605(2)
For the purposes of this Chapter and Chapters
6A
and
6C
, securities are not taken to be different classes merely because:
(a)
some of the securities are fully-paid and others are partly-paid; or
(b)
different amounts are paid up or remain unpaid on the securities.
SECTION 605A
605A
CHAPTER DOES NOT APPLY TO MCIs
CCH Note:
Section 605A is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
This Chapter does not apply to MCIs.
History
S 605A inserted by No 37 of 2019, s 3, Sch 2[9] (effective 6 April 2019).
PART 6.6
-
VARIATION OF OFFERS
Division 1
-
Market bids
CCH Note:
Division 1 is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
SECTION 649A
649A
GENERAL
CCH Note:
Section 649A is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
A bidder may only vary the offers under a market bid in accordance with section
649B
or
649C
.
Note: ASIC may allow other variations under section
655A
.
SECTION 649B
649B
MARKET BIDS
-
RAISING BID PRICE
CCH Note:
Section 649B is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
The bidder may vary the offers under a market bid to increase the price offered to acquire securities under the market bid. They may not do so, however, during the last 5 trading days of the relevant financial market in the offer period.
History
S 649B amended by No 69 of 2023, s 3, Sch 2[98] (effective 15 September 2023).
S 649B amended by No 122 of 2001, s 3, Sch 1, Pt 2
[
386].
SECTION 649C
MARKET BIDS
-
EXTENDING THE OFFER PERIOD
CCH Note:
Section 649C is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
649C(1)
The bidder may extend the offer period. The extension must be announced to the relevant financial market at least 5 trading days of the market before the end of the offer period. However, the announcement may be made up to the end of the offer period if during those 5 trading days:
(a)
another person lodges with ASIC a bidder
'
s statement for a takeover bid for securities in the bid class; or
(b)
another person announces a takeover bid for securities in the bid class; or
(c)
another person makes offers under a takeover bid for securities in the bid class; or
(d)
the consideration for offers under another takeover bid for securities in the bid class is improved.
The offer period is extended by having the extension announced to the relevant financial market.
Note: Section
624
provides for an automatic extension of the bid period in certain circumstances.
[
CCH Note:
S 649C(1) will be amended by No 69 of 2020, s 3, Sch 1[1008], by substituting
"
the Registrar
"
for
"
ASIC
"
in para (a) (effective 1 July 2026 or a day or days to be fixed by Proclamation).]
History
S 649C(1) amended by No 122 of 2001, s 3, Sch 1, Pt 2
[
387-388].
649C(2)
On the day on which the announcement is made, the bidder must:
(a)
give the target and the relevant market operator a notice setting out the terms of the announcement; and
(b)
lodge a notice setting out the terms of the announcement with ASIC.
[
CCH Note:
S 649C(2) will be amended by No 69 of 2020, s 3, Sch 1[1008], by substituting
"
the Registrar
"
for
"
ASIC
"
in para (b) (effective 1 July 2026 or a day or days to be fixed by Proclamation).]
History
S 649C(2) amended by No 122 of 2001, s 3, Sch 1, Pt 2
[
389].
[
CCH Note:
S 649C(2A) will be inserted by No 69 of 2020, s 3, Sch 1[1009] (effective 1 July 2026 or a day or days to be fixed by Proclamation). S 649C(2A) will read:
649C(2A)
The notice must meet any requirements of the data standards.]
649C(3)
An offence based on subsection
(2)
is an offence of strict liability.
Note: For
strict liability
, see section
6.1
of the
Criminal Code
.
History
S 649C(3) inserted by No 117 of 2001, s 3, Sch 1
[
220].
Division 2
-
Off-market bids (express variation by bidder)
CCH Note:
Division 2 is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
SECTION 650A
GENERAL
CCH Note:
Section 650A is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
650A(1)
A bidder may only vary the offers under an off-market bid in accordance with section
650B
,
650C
or
650D
.
Note: ASIC may allow other variations under section
655A
.
650A(2)
If the bidder varies the offer under an off-market bid in accordance with section
650B
,
650C
or
650D
, the bidder must vary all unaccepted offers under the bid in the same way.
Note: Subsections
650B(2)
and
(3)
deal with the effect of a variation on takeover contracts that have already resulted from acceptances of offers under the bid when the variation is made.
SECTION 650B
OFF-MARKET BIDS
-
CONSIDERATION OFFERED
CCH Note:
Section 650B is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
Improving the consideration offered
650B(1)
The bidder may vary the offers made under the bid to improve the consideration offered:
(a)
by increasing a cash sum offered; or
(b)
by increasing the number of securities offered; or
(c)
by increasing the rate of interest payable under debentures offered; or
(d)
by increasing the amount or value of debentures offered; or
(e)
by increasing the number of unissued securities that may be acquired under options offered; or
(f)
by offering a cash sum in addition to securities; or
(g)
if the securities being acquired include shares to which rights to accrued dividends are attached
-
by giving the holders the right to:
(i)
retain the whole or a part of the dividend; or
(ii)
be paid an amount equal to the amount of the dividend;
in addition to the consideration already offered; or
(h)
offering an additional alternative form of consideration.
Note: If the bidder increases the consideration during the last 7 days of the offer period, subsection
624(2)
extends the offer period by a further 14 days.
Effect of increase in consideration on offers already accepted
650B(2)
Improving the consideration has the effects set out in the following table on the rights of a person who has already accepted an offer when the variation is made.
Effect of improving consideration
|
[
operative
]
|
|
Improvement
|
Effect on person who has already accepted bid offer
|
1 |
improvement of the only form of consideration being offered |
entitled to the improved consideration |
2 |
2 or more forms of consideration offered and all forms improved by the same factor or percentage |
entitled to the improvement in the form of consideration accepted |
3 |
2 or more forms of consideration offered and improvement in the consideration is identical for all forms |
entitled to the improvement in the form of consideration accepted |
4 |
addition of a new form of consideration |
entitled to make a fresh election as to the form of consideration to be taken |
5 |
any other improvement |
entitled to make a fresh election as to the form of consideration to be taken |
History
S 650B(2) amended by No 122 of 2001, s 3, Sch 3, Pt 1
[
21].
650B(2A)
The person is entitled to receive the improved consideration immediately, subject to the following paragraphs:
(a)
if the time for payment of the consideration in accordance with subsection
620(2)
has not yet occurred, the person is not entitled to receive the improved consideration until that time;
(b)
if the person has to make an election before being entitled to the improved consideration, the person is not entitled to receive the improved consideration until the later of:
(i)
the time when the election is made; and
(ii)
the time applicable under paragraph (a).
History
S 650B(2A) inserted by No 122 of 2001, s 3, Sch 3, Pt 1
[
22].
Fresh election as to the form of consideration
650B(3)
If a person who has already accepted an offer has the right to make a fresh election as to the form of consideration to be taken, the bidder must send the person as soon as practicable after the variation a written notice informing them about their right to make the election.
Note 1: Section
651B
says how the election is to be exercised.
Note 2: Sections
648B
and
648C
provide for the manner in which documents may be sent to holders.
Strict liability offences
650B(4)
An offence based on subsection
(3)
is an offence of strict liability.
Note: For
strict liability
, see section 6.1 of the
Criminal Code
.
History
S 650B(4) inserted by No 117 of 2001, s 3, Sch 1
[
221].
SECTION 650C
OFF-MARKET BIDS
-
EXTENSION OF OFFER PERIOD
CCH Note:
Section 650C is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
650C(1)
A bidder making an off-market bid may extend the offer period at any time before the end of the offer period.
650C(2)
If the bid is subject to a defeating condition, the bidder may extend the offer period after the publication of the notice under subsection
630(3)
only if one of the following happens after the publication:
(a)
another person lodges with ASIC a bidder
'
s statement for a takeover bid for securities in the bid class;
(b)
another person announces a takeover bid for securities in the bid class;
(c)
another person makes offers under a takeover bid for securities in the bid class;
(d)
the consideration for offers under another takeover bid for securities in the bid class is improved.
Note: Section
624
says how long the total offer period can be.
[
CCH Note:
S 650C(2) will be amended by No 69 of 2020, s 3, Sch 1[1010], by substituting
"
the Registrar
"
for
"
ASIC
"
in para (a) (effective 1 July 2026 or a day or days to be fixed by Proclamation).]
SECTION 650D
OFF-MARKET BIDS
-
METHOD OF MAKING VARIATION
CCH Note:
Section 650D is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
Variation to be made by notice to the target and holders
650D(1)
To vary offers under an off-market bid, the bidder must:
(a)
prepare a notice that:
(i)
sets out the terms of the proposed variation; and
(ii)
if the bid is subject to a defeating condition and the proposed variation postpones for more than 1 month the time by which the bidder must satisfy their obligations under the bid
-
informs people about the right to withdraw acceptances under section
650E
; and
(b)
lodge the notice with ASIC; and
(c)
after the notice is lodged, give the notice to:
(i)
the target; and
(ii)
everyone to whom offers weremade under the bid.
Note: Sections
648B
and
648C
provide for the manner in which documents may be sent to holders.
[
CCH Note 1:
S 650D(1) will be amended by No 69 of 2020, s 3, Sch 1[1010], by substituting
"
the Registrar
"
for
"
ASIC
"
in para (b) (effective 1 July 2026 or a day or days to be fixed by Proclamation).]
[
CCH Note 2:
S 650D(1A) will be inserted by No 69 of 2020, s 3, Sch 1[1011] (effective 1 July 2026 or a day or days to be fixed by Proclamation). S 650D(1A) will read:
650D(1A)
Lodgement of the notice must meet any requirements of the data standards.]
650D(2)
A person must be sent a copy of the notice under subparagraph
(1)(c)(ii)
even if they have already accepted the offer. However, they need not be sent a copy if:
(a)
the variation merely extends the offer period; and
(b)
the bid is not subject to a defeating condition at the time the notice is given to the target.
650D(3)
A notice under subsection
(1)
must be signed by:
(a)
if the bidder is, or includes, an individual
-
the individual; and
(b)
if the bidder is, or includes, a body corporate (other than a notified foreign passport fund) with 2 or more directors
-
not fewer than 2 of the directors who are authorised to sign the notice by a resolution passed at a directors
'
meeting; and
(c)
if the bidder is, or includes, a body corporate (other than a notified foreign passport fund) that has only one director
-
that director.
History
S 650D(3) amended by No 61 of 2018, s 3, Sch 2[157] (effective 18 September 2018).
650D(4)
A copy of a notice given to a person under subparagraph
(1)(c)(ii)
must include a statement that:
(a)
a copy of the notice was lodged with ASIC on a specified date; and
(b)
ASIC takes no responsibility for the contents of the notice.
[
CCH Note:
S 650D(4) will be amended by No 69 of 2020, s 3, Sch 1[1012] and
[
1013], by substituting para (a) and
"
neither ASIC nor the Registrar takes
"
for
"
ASIC takes no
"
in para (b) (effective 1 July 2026 or a day or days to be fixed by Proclamation). Para (a) will read:
(a)
the notice was lodged with the Registrar on a specified date; and]
SECTION 650E
RIGHT TO WITHDRAW ACCEPTANCE
CCH Note:
Section 650E is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
650E(1)
A person who accepts an offer made under an off-market bid may withdraw their acceptance of the offer if:
(a)
the bid is subject to a defeating condition; and
(b)
the bidder varies the offers under the bid in a way that postpones for more than 1 month the time when the bidder has to meet their obligations under the bid; and
(c)
the person is entitled to be given a notice of the variation under subsection
650D(1)
.
650E(2)
To withdraw their acceptance, the person must:
(a)
give the bidder notice within 1 month beginning on the day after the day on which the copy of the notice of the variation was received; and
(b)
return any consideration received by the person for accepting the offer.
650E(3)
A notice under paragraph
(2)(a)
must:
(a)
comply with the conditions specified in regulations made for the purposes of this paragraph; or
(b)
if no such regulations are made
-
be in writing.
History
S 650E(3) substituted by No 122 of 2001, s 3, Sch 1, Pt 2
[
390].
650E(4)
To return consideration that includes securities, the person must:
(a)
take any actions that are specified in regulations made for the purposes of this paragraph in relation to the return of those securities; or
(b)
if no such regulations are made
-
give the bidder any transfer documents needed to effect the return of the securities.
History
S 650E(4) amended by No 122 of 2001, s 3, Sch 1, Pt 2
[
391].
650E(5)
If the person withdraws their acceptance, the bidder must:
(a)
take any actions that are specified in regulations made for the purposes of this paragraph in relation to the withdrawal of acceptance; and
(b)
return any documents that the person sent the bidder with the acceptance of the offer;
within 14 days after:
(c)
if the person does the things referred to in subsection (2) on the same day
-
that day; or
(d)
if the person does those things on different days
-
the last of those days.
History
S 650E(5) amended by No 122 of 2001, s 3, Sch 1, Pt 2
[
392].
650E(6)
If under this section a person returns to a company any certificates (together with any necessary transfer documents) in respect of the securities issued by the company, the company must cancel those securities as soon as possible. Any reduction in share capital is authorised by this subsection.
650E(7)
An offence based on subsection
(5)
or
(6)
is an offence of strict liability.
Note: For
strict liability
, see section 6.1 of the
Criminal Code
.
History
S 650E(7) inserted by No 117 of 2001, s 3, Sch 1
[
222].
SECTION 650F
FREEING OFF-MARKET BIDS FROM DEFEATING CONDITIONS
CCH Note:
Section 650F is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
650F(1)
If the offers under an off-market bid are subject to a defeating condition, the bidder may free the offers, and the takeover contracts, from the condition only by giving the target a notice declaring the offers to be free from the condition in accordance with this section:
(a)
if the condition is that the bidder may withdraw unaccepted offers if an event or circumstance referred to in subsection
652C(1)
or
(2)
occurs in relation to the target
-
not later than 3 business days after the end of the offer period; or
(b)
in any other case
-
not less than 7 days before the end of the offer period.
650F(2)
The notice must:
(a)
state that the offers are free from the condition; and
(b)
specify the bidder
'
s voting power in the company.
650F(3)
The notice must be:
(a)
if the securities in the bid class are quoted
-
given to the relevant market operator; and
(b)
if those securities are not quoted
-
lodged with ASIC.
[
CCH Note:
S 650F(3) will be amended by No 69 of 2020, s 3, Sch 1[1014], by substituting
"
the Registrar
"
for
"
ASIC
"
in para (b) (effective 1 July 2026 or a day or days to be fixed by Proclamation).]
History
S 650F(3) amended by No 122 of 2001, s 3, Sch 1, Pt 2
[
393].
[
CCH Note:
S 650F(3A) will be inserted by No 69 of 2020, s 3, Sch 1[1015] (effective 1 July 2026 or a day or days to be fixed by Proclamation). S 650F(3A) will read:
650F(3A)
If the notice is lodged with the Registrar, the lodgement must meet any requirements of the data standards.]
650F(4)
An offence based on subsection
(3)
is an offence of strict liability.
Note: For
strict liability
, see section
6.1
of the
Criminal Code
.
History
S 650F(4) inserted by No 117 of 2001, s 3, Sch 1
[
223].
SECTION 650G
650G
CONTRACTS AND ACCEPTANCES VOID IF DEFEATING CONDITION NOT FULFILLED
CCH Note:
Section 650G is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
All takeover contracts, and all acceptances that have not resulted in binding takeover contracts, for an off-market bid are void if:
(a)
offers made under the bid have at any time been subject to a defeating condition; and
(b)
the bidder has not declared the offers to be free from the condition within the period before the date applicable under subsection
630(1)
or
(2)
; and
(c)
the condition has not been fulfilled at the end of the offer period.
A transfer of securities based on an acceptance or contract that is void under this section must not be registered.
Division 3
-
Off-market bids (automatic variations)
CCH Note:
Division 3 is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
SECTION 651A
OFF-MARKET BID
-EFFECT ON BID CONSIDERATION OF PURCHASES MADE OUTSIDE BID
CCH Note:
Section 651A is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
Effect of purchases outside bid on offers made under the bid
651A(1)
The offers made under an off-market bid, and the takeover contracts, are varied under this section if:
(a)
the bidder purchases securities in the bid class outside the bid during the bid period; and
(b)
the consideration for that purchase consists solely of a cash sum; and
(c)
either:
(i)
the consideration, or 1 of the forms of consideration, payable under the bid consists of a cash sum only and the consideration referred to in paragraph (b) is higher than the cash sum payable for the securities under the bid; or
(ii)
a cash sum only is not the consideration, or 1 of the forms of consideration, payable under the bid.
Note 1: Section
9
defines
takeover contract
Note 2: The effect of section
623
is that the purchase outside the bid has to be made through an on-market transaction (see subsection
623(1)
and paragraph
623(3)(b)
).
Effect on unaccepted cash offers
651A(2)
If:
(a)
one of the forms of consideration offered to a person under an off-market bid is a cash sum only; and
(b)
the person has not accepted the offer before the purchase outside the bid occurs;
the cash sum is taken to be increased to the highest outside purchase price before the offer is accepted.
Effect on cash offers already accepted
651A(3)
The consideration payable for each security covered by a takeover contract arising from the acceptance of an offer for a cash sum only is increased to the highest outside purchase price. If the person who accepted the offer has already received the whole or any part of the consideration under the contract, they are entitled to receive the increase in consideration immediately.
Effect on non-cash offers accepted at any time during bid period
651A(4)
If:
(a)
a person accepts an offer under a bid at any time during the bid period; and
(b)
the consideration paid or provided, or to be paid or provided, under the takeover contract arising from the acceptance of the offer does not consist of a cash sum only;
then:
(c)
the person may elect to take as consideration for each security covered by the takeover contract a cash sum equal to the highest outside purchase price instead of the consideration they originally accepted; and
(d)
the bidder must give the person a written notice of their right to make the election within 14 days after the end of the offer period.
Note: Section
651B
says how the election is to be exercised.
651A(5)
An offence based on subsection
(4)
is an offence of strict liability.
Note: For
strict liability
, see section 6.1 of the
Criminal Code
.
History
S 651A(5) inserted by No 117 of 2001, s 3, Sch 1
[
224].
SECTION 651B
HOW TO MAKE AN ELECTION FOR NEW FORMS OF CONSIDERATION
CCH Note:
Section 651B is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
651B(1)
An election under section
650B
or
651A
to take a new form of consideration must be made:
(a)
by written notice to the bidder; and
(b)
within 1 month after the person receives the notice from the bidder of their right to make the election.
651B(2)
The person becomes entitled to the new form of consideration if they:
(a)
make the election; and
(b)
return to the bidder:
(i)
any consideration they have already received; and
(ii)
any necessary transfer documents.
SECTION 651C
RETURNING SECURITIES AS PART OF ELECTION
CCH Note:
Section 651C is modified by the ASIC Corporations (Takeover Bids) Instrument 2023/683; the ASIC Corporations (Warrants: Relevant Interests and Associations) Instrument 2023/687; and the ASIC Corporations (Replacement Bidder
'
s and Target
'
s Statements) Instrument 2023/688.
651C(1)
If under section
651B
a person returns to a company any certificates (together with any necessary transfer documents) in respect of the securities issued by a company, the company must cancel those securities as soon as possible.
651C(2)
An offence based on subsection
(1)
is an offence of strict liability.
Note: For
strict liability
, see section 6.1 of the
Criminal Code
.
History
S 651C(2) inserted by No 117 of 2001, s 3, Sch 1
[
225].