Listed companies should brace themselves for an increase in low-ball unsolicited offers to their Mum & Dad shareholders before Parliament shuts down a loophole later in the year.

The Bill, designed to deny access to share registers for the purpose of making unsolicited offers at below market value, was unfortunately not passed into law before Parliament rose for the Winter recess. With Parliament not due to meet again until 24 August (even if there is no election in the interim), the Bill is unlikely to become law for several months.

This effectively gives low-ball offerors a window of opportunity in which to get access to share registers. They may also be encouraged by the recent decline in the stock market.

Companies that wish to protect their shareholders against low-ball offers should contact us as soon as they are aware that a predator is sniffing around. A program of legal vigilance and shareholder education can then be devised to minimise the impact of any unsolicited offer and to make life difficult for a predator.

It is also advisable to inform shareholders of the downsides of accepting a low-ball offer.

The company should also alert ASIC. Low-ball offers are a serious concern to the corporate regulator. It has intervened on numerous occasions when shareholders have been targeted in this way. ASIC is also prepared to issue public warnings to retail shareholders about low-ball offers.

Further details are available at Mondaq.