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Truth in Takeovers

ASIC Policy Statement ‘PS 25 Truth in Takeovers’ provides that a person who makes a last and final statement in relation to a takeover bid should be held to that statement and cannot depart from the statement unless the person clearly and expressly qualifies it at the time of making it. The Panel repeated its previously expressed support for the principles behind this policy and its view that they are fundamental tenets of the Australian takeover regime.


ASIC's Truth in Takeovers policy says that a bidder or other market participant can't depart from an unqualified statement to the market because that would be misleading or deceptive. This commonly applies in the context of "best and final" statements, where a bidder may declare a final offer price and "drop-dead" date for closing its bid. This practice is intended to encourage target shareholders to accept the bid at the current price. Unless the bidder expressly reserves the right to change its mind, that price and closing date are then set in stone.