UK Takeover Code - Final Changes Support Target Boards

Further to our May 2011 post, the UK Takeover Panel has finalised significant amendments to the UK Takeover Code which, when implemented on September 19, 2011, will herald a substantial rebalancing of power in favour of target boards.

As expected, the principal amendments to the Code are substantially the same as originally proposed by the Panel. This draws a line under the Panel's protracted consultation process triggered by the political furore arising from the successful takeover by Kraft of Cadbury in 2010.

From a strategic and commercial perspective, the most important changes are:

• the banning of break fees and other common deal protection measures;
• the public identification of all potential bidders at the start of a transaction via a "possible offer" announcement to be made by the target company;