“AusNet is sailing close to the wind by granting Brookfield exclusivity without a ‘fiduciary out’ in sight,” he explains. “But what makes this takeover battle particularly interesting is that, regardless of the outcome, the Takeovers Panel may be compelled to re-write the rules on if and when target companies are required to provide rival bidders equal access to its information.”
As Jason outlines, it is not always clear how the principles on which Australia’s takeovers regulatory regime is founded – the so-called Eggleston Principles – might apply in particular circumstances, requiring the Panel to plug the gaps by publishing guidance notes which elaborate on policy relevant in control transactions.
“However, the Takeovers Panel has remained largely silent on the issue of whether a target is required to provide equal access to information to competing bidders based on its view that there is no legal or policy requirement for this in Australia. By assuming this position, the Takeovers Panel has given target boards broad discretion to selectively provide information to some potential bidders at the exclusion of others.
“With M&A deal volumes in Australia sitting at 10 times the 5-year average, listed companies will need to be more prepared than ever to deal with hostile and competing offers. The high-profile competition for AusNet provides the Takeovers Panel with fertile ground to clarify a significant, unresolved question about the state of the playing field. “
To read the full article in the AFR, click here.