Panel puts curbs on takeover battles

THE Irish Takeover Panel is to impose radical controls over media wars waged by opposing factions in future takeover battles of public quoted companies.

Tánaiste and Minister for Enterprise, Trade and Employment Mary Harney is currently examining the 2002 annual report of the Irish Takeover Panel, which has been seen by the Irish Examiner.

The report is expected to be published after the minister has examined it. The report outlines the intentions of the regulatory body to change the way in which takeover battles to win the hearts, minds and votes of shareholders are fought in the newspapers and on the air waves.

The ITP in future will demand warring sides in a takeover tussles to prove they have the support of shareholders when they make claims of support.

ITP director general Miceal Ryan in the report says under the heading Statements of Shareholder Support: “Information released during the course of an (takeover) offer must satisfy the standards of accuracy, completeness and fair presentation as would be required of a prospectus.

In a competitive or hostile takeover, the intentions of offeree shareholders are of particular importance. Statements concerning such intentions must not be made unless the up-to-date intentions of the relevant shareholders have been clearly stated to the offeree or its advisers or where relevant to the offeror or its advisers.

The panel should be consulted in advance of any such statements being made. In such circumstances, the panel will require any such statements to be verified to its satisfaction, and this may include immediate confirmation being given directly to the panel by the relevant shareholder.”

The takeover panel is also to clamp down on internet website postings by parties engaged in takeover battles, Mr Ryan’s report reveals. “The panel will regard any public notice, published by whatever means, by or on behalf of an offeror or an offeree during the course of an offer as constituting a commercial advertisement,” he said.

In effect, this means the approval of the ITP will be required before postings to websites by the parties involved in a takeover can be made. Mr Ryan also outlines a change in disclosure rules when a publicly quoted company makes an announcement that talks are taking place.

"The offeror and all persons acting in concert with it must disclose all dealings under Rule 8.1 and such disclosures must include the identity of the offeror as required by Rule 8.6. This applies regardless of whether or not the identity of the offeror has been disclosed in the aforementioned announcement,” said Mr Ryan.

ITP chairman Daniel O’Keeffe SC said the panel was drafting new rules in a number of areas including: changes required as a result of the passing of the Competition Act 2002; and in the area of takeover schemes, which it is envisaged will come into effect next year.

A copy of the final report shows the ITB is on a sound financial footing, adding €400,000 to its contingency reserves in the year to the end of June 2002, bringing the reserves of the tax exempt entity founded in 1997 to €1.352 million.