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ARTICLE · 20 JULY 2026

Some Lessons From The Humm Situation

Herbert Smith Freehills Kramer LLP
Herbert Smith Freehills Kramer LLP
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Herbert Smith Freehills Kramer LLP

Herbert Smith Freehills Kramer LLP

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When a takeover proposal is received, the board must rigorously assess whether any director has a personal interest that could be affected by the outcome of the proposal. If there is any reasonable perception of a lack of independence — even if the director believes they can act impartially — that director should be excluded from the board's consideration of the matter and an independent board committee should be formed.

AustraliaCorporate/Commercial Law
Rodd Levy
Rodd Levy
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 IN BRIEF

  • When a takeover proposal is received, the board must rigorously assess whether any director has a personal interest that could be affected by the outcome of the proposal. If there is any reasonable perception of a lack of independence — even if the director believes they can act impartially — that director should be excluded from the board's consideration of the matter and an independent board committee should be formed.
  • ASX announcements must accurately reflect the board's actual position on a proposal. Stating that a proposal is being 'carefully evaluated' when the board has in substance already decided to reject it is likely to be found misleading.
  • A target board must substantively engage with a takeover proposal. The Panel will scrutinise whether the board's actions are consistent with its public statements and may substitute its own views on what constitutes genuine engagement.

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