Mergers and acquisitions update

In this update we look at the vital role hedge funds played in the Rio Tinto/Riversdale takeover, how A-REIT bids present unitholders with avenues to challenge a bid which are not available to shareholders in a company, whether the Centro principles might apply to M&A transactions and finally, how ASIC is trying to resolve tensions with independent expert reports.

Examining the consequences of the wind-up meeting requisitioned by hedge funds in the EDT bid  The failure of hedge funds' attempt to wind up EDT Retail Trust is a reminder that A-REIT bids present unitholders with avenues to challenge a bid which are not available to shareholders in a company.  It is also an approach that is not without risk. Click here to read more

Rio Tinto meets Riversdale Mining: when hedge funds are your friends Commentators and the market have lauded Rio Tinto's M&A credentials in relation to its bid for Riversdale Mining.  For most of the bid duration the top two shareholders held more than 45% of Riversdale so how did Rio Tinto achieve its goal of absolute control? The answer lies in clever strategy and a lot of help from hedge funds. Click here to read more

What does the Centro decision mean for boards in the context of takeover transactions? The Federal Court's decision concerning the directors and chief financial officer of the Centro Group focussed on the responsibilities of directors and management in the context of reviewing financial statements. We consider whether the same principles might apply to directors and management in the context of takeover transactions. Click here to read more

Resolving some emerging tensions with independent expert reports Independent expert reports are commissioned by company directors to assist shareholders in assessing a broad range of M&A transactions. But perceptions that independent expert reports are often not as objective as they're held out to be and that the expert's valuation and conclusions predictably coincide with the directors' own recommendations has prompted ASIC to issue updated guidance to raise the standard of expert reports and address concerns about perceived independence. Click to here to read more

If you'd like to discuss any of the issues raised above, please contact the authors or any of our team. 

Partner: Gerry Cawson