City code on takeovers and mergers


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City code on takeovers and mergers

City code on takeovers and mergers

a regulatory system operated voluntarily by interested parties to the UK STOCK MARKET that lays down rules of good conduct governing the tactics and procedures used in TAKEOVERS and MERGERS. The general purpose of the code is to ensure that all SHAREHOLDERS (both the shareholders of the firm planning the takeover and those of the target firm) are treated equitably For example, a potential bidder who has been acquiring shares in the open market is required to make a formal bid for all outstanding shares at a price not less than the highest price paid in the market over the previous 12 months, once his holding exceeds 30%. There are various other rules covering such areas as the accumulation of shares by several buyers acting together (see TAKEOVER BID). The City code is administered by the City panel on Takeovers and Mergers, which is responsible for formulating rules of practice and for investigating suspected cases of malpractice.
References in periodicals archive ?
6 of the City Code on Takeovers and Mergers, in order to enable conversations with parties interested in making proposals on a confidential basis.
CONSULTATION PAPER 87: ENDORSEMENT OF THE CITY CODE ON TAKEOVERS AND MERGERS AND THE RULES GOVERNING SUBSTANTIAL ACQUISITIONS OF SHARES [section] 2.