The Takeover Panel is consulting on making amendments to the Takeover Code impacting on reporting on profit forecasts, asset valuations and merger benefit statements.
The aim of the changes is to achieve coherence and consistency in applying the requirements for reporting on unaudited financial information as well as reflecting developments in market practice, accounting rules and UKLA Rules relating to the publication of forward-looking or other unaudited financial information.
The proposed amendments include:
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relaxation of the reporting requirements on profit forecasts and asset valuations where these are published in the “normal course” of a company’s business;
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extending the periodic reporting exemptions in the profit forecast rules to specifically cover interim management statements as well as interim reports published by AIM and PLUS companies;
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requiring a report where a profit forecast is made for part of a business; and
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expanding the scope of merger benefit statements to apply to any quantified statement of the expected financial effects of a course of action proposed in the context of an offer.
Further detail on these proposed amendments will be available in the next edition of UK Corporate Update. Comments are invited by 21 May 2010 and relevant changes to the Code are likely to be implemented later in 2010. Click here to see the Panel consultation paper.
