ACCA Strategic Professional · Advanced Financial Management · Regulatory framework and processes
Under the UK City Code style of takeover regulation, which statement about the bid timetable is correct once an offer document has been posted?
The offer must stay open for at least 21 days after the offer document is posted. This gives target shareholders adequate time to consider it. Early closure on reaching 50% acceptances is not allowed, and the target cannot frustrate the bid without shareholder approval.
- AThe offer must remain open for at least 21 days from postingCorrect
- BThe offer may be closed after 7 days if 50% acceptances are received
- CThe target board may take any frustrating action without shareholder approval
- DTerms of the offer may be reduced after the first closing date
Explanation
The offer must be open for acceptance for at least 21 days after posting. Acceptances at 50% do not allow early closure within this period. The target board generally cannot take frustrating action without shareholder approval, and the terms cannot be worsened.
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