Private M&A and Public company takeovers
The 2017 Lex Mundi Global Seminar on Cross-Border Transactions was held on 2 November 2017 in London, United Kingdom. The seminar brought together legal practitioners, financial institutions and advisers, commentators and market participants in the cross-border M&A sphere to discuss key trends and developments in cross-border transactions. We have summarised the discussions and conclusions of the different seminar sessions in the following five news analysis articles:
The global M&A marketplace
Corporate analysis: Topics covered in the discussion of global M&A trends included: deal value and volume, investment from China, drivers of M&A, the current market, PE involvement, anti-trust and regulatory concerns, Brexit and predictions for 2018.
For further information, see The global M&A marketplace.
Regional developments in M&A
Corporate analysis: The discussion of regional developments in M&A covered developments in the following countries/regions: France, Germany, the United States, South America and the United Kingdom.
For further information, see Regional developments in M&A.
Protectionism and investment restrictions in the US and Germany
Corporate analysis: The discussion of protectionism and investment restrictions in the United States and Germany included covered the following topics: developments in protectionism and foreign investment in Europe, the Committee on Foreign Investment in the US, M&A considerations and recommendations, and German Foreign Direct Investment (FDI) restrictions,
For further information, see Protectionism and investment restrictions in the US and Germany.
W&I insurance—overview and outlook
Corporate analysis: The discussion concerning warranty and indemnity (W&I) insurance covered: the W&I insurance industry, benefits of W&I insurance, limitations of W&I insurance, the importance of due diligence, timeframes and processes, deal size and coverage, known risks and specific area insurance, and payouts.
For further information, see W&I insurance—overview and outlook.
Developments in shareholder activism
Corporate analysis: The discussion concerning shareholder activism covered: the increase in activism across Europe, types of activism and how targets are responding
For further information, see Developments in shareholder activism
Private M&A (share purchase)
Court of Appeal finds notification of claims arising out of share sale and purchase agreement invalid for lack of certainty and precision (Teoco UK Ltd v Aircom Jersey 4 Ltd)
Dispute Resolution analysis: In this case the Court of Appeal interpreted the meaning of a claims notification provision in a share sale and purchase agreement. The Court of Appeal underlined that the meaning of such a clause will always turn on its own individual wording but nevertheless relied on, and drew, guidance from previous cases which considered similarly worded claims notification clauses. It ruled firmly in favour of parties giving each other as much information as possible in order to achieve certainty as to what exactly the claim is regarding.
For further information, see Court of Appeal finds notification of claims arising out of share sale and purchase agreement invalid for lack of certainty and precision (Teoco UK Ltd v Aircom Jersey 4 Ltd)
Public company takeovers
Court of Appeal overturns decision in Easynet cross-border case (Easynet Global Services Ltd)
Corporate analysis: The Court of Appeal has considered whether a UK company could effect a merger pursuant to the Cross-Border Merger Regulations 2007 where the only non-UK EEA company involved in the transaction was a dormant entity. Overturning the Companies Court’s earlier decision, the Court of Appeal held that the transaction fell within the scope of the Regulations.
For further information, see Court of Appeal overturns decision in Easynet cross-border case (Easynet Global Services Ltd)
Law Society competition committee responds to foreign ownership security paper
The City of London Law Society Competition Law Committee has provided its second response to the government’s green paper (published on 17 October 2017) on its review of the national security implications of foreign ownership or control. Among other things, the committee says it strongly favours a voluntary regime for all transactions raising potential national security concerns, and that should the government choose to introduce a mandatory regime, it must consider whether there will be an automatic standstill obligation until the transaction is approved on national security grounds.
For further information, see LNB News 22/01/2018 76.
Company disclosures, records and registers
Public register of beneficial ownership for foreign companies owning property in the UK
The government has confirmed in a written ministerial statement its intention to introduce a draft Bill before the summer recess in 2018 to establish a public register of beneficial ownership for foreign companies owning property in the UK. Formal introduction of the Bill is planned for summer 2019, with the register expected to become operational by early 2021. This follows an announcement made in the House of Lords during the debate on the Sanctions and Anti-Money Laundering Bill on 17 January.
The intention to create such a register was first announced at the international anti-corruption summit held in London in May 2016. In April 2017, BEIS published a call for evidence on the design and impacts of the register, following which the government began drafting clauses covering the land registration elements of the policy in England and Wales. Specific provision will also be made for land registration systems in Scotland and Northern Ireland.
The register will also provide the government with greater transparency on overseas companies seeking public contracts.
BEIS will publish its response to the April 2017 call for evidence shortly.
For further information, see LNB News 19/01/2018 19.
Gender pay gap for full-time workers ‘entirely in favour of men’
The Office for National Statistics (ONS) has released analysis on the gender pay gap which provides insight into the factors surrounding the difference in men’s and women’s pay. The ONS concludes that, while the pay gap in the UK has reduced in the last ten years, the gap for full-time workers is entirely in favour of men in every occupation. Experts from the University of Sussex say the analysis shows the merits of transparency in reporting the gender pay gap. Meanwhile, lawyers at Baker McKenzie suggest the ‘biggest single cause’ of the gender pay gap is the comparative lack of women occupying senior roles.
Key points from the ONS report includes analysis that shows, between 2011 and 2017, men’s pay has grown by 10.4% while women’s pay has grown by 12% and women’s pay growth in 2017 in respect of age was lower than men’s pay growth.
For further information, see LNB News 17/01/2018 121.
Additional news—daily and weekly news alerts
This document contains the highlights from the past week’s news. To receive all our news stories, whether on a daily or a weekly basis, amend your personal settings within your ‘News’ tab on the homepage by clicking on either ‘Email’ or ‘RSS’ (depending on how you prefer to receive them) on the right hand side of the blue banner.
Dates for your diary
|29 January 2018||Pursuant to AIM Notice 49, issued by the London Stock Exchange (LSE), the LSE has published a feedback statement to its discussion paper published on 11 July 2017 (AIM Notice 46) reviewing the AIM Rules, as well as a consultation on proposed changes. Comments on the proposed changes to the AIM Rules for Companies (AIM Rules) and the AIM Rules for Nominated Advisers (Nomad Rules) should be sent by 29 January 2018.
The purpose of the discussion paper was to invite feedback on various areas of the AIM Rules and the Nomad Rules. The LSE is consulting on proposals that formalise an early notification process for nominated advisors, provide guidance to nominated advisors on appropriateness considerations and require AIM companies to comply or explain against a recognised corporate governance code.
For further information, see LNB News 11/12/2017 114.
|January 2018||Corporate governance: FRC will publish its annual report on developments in corporate governance and stewardship.|
|1 February 2018||Institutional Shareholder Services (ISS) has published its 2018 benchmark policy updates. The updated policies will generally be applied for shareholder meetings on or after 1 February 2018. The principal change is the introduction of a new policy to deal with the evolving practice of virtual shareholder meetings, but other changes include around the policies on director overboarding, audit and remuneration committee composition, threshold levels for long-term incentive plans (LTIPs) and share issuances without pre-emption rights.
For further information, see LNB News 17/11/2017 94.
|1 February 2018||Responses are sought on proposed minor changes to the Listing Rules (LRs) and Disclosure Guidance and Transparency Rules (DTRs) as set out in FCA CP17/39 Quarterly Consultation Paper.
The changes in the LRs clarify the meaning of Premium Listing Principle 6 in the LRs. The changes in the DTRs clarify where the diversity report may be located under corporate governance reporting requirements.
For further information, see LNB News 01/12/2017 129.
To track legislative and regulatory developments, see our Trackers:
New Q&As added this week:
Our Market Tracker deal analysis tool is available here.
To read about the latest corporate announcements, see our Market Tracker weekly round-up: Market Tracker weekly round-up—19 January 2018.