TMA-2 TMA-2 Rules
TMA-2.1 TMA-2.1 Communication of the Offer
TMA-2.1.1
An
offer must be put forward in the first instance to the board of directors (the "board") of theofferee company in writing.Identity of Offeror
TMA-2.1.2
If the
offer or an approach with a view to anoffer being made is not made by the ultimateofferor or potentialofferor , the identity of that person must be disclosed at the outset to the board of theofferee company. When that person is a company, the identity of its ultimate controlling shareholder(s) and the identity of its ultimate parent company, or, where there is a listed company in the chain between such company and its ultimate parent company, the identity of such listed company must be disclosed.Amended: October 2019Seriousness of Offeror
TMA-2.1.3
The board of the
offeree company when approached is entitled to be satisfied that theofferor is, or will be, in a position to implement theoffer in full. Anofferor , upon receiving a request from the board of theofferee company, must provide reasonable information to verify that theofferor is, or will be, in a position to implement theoffer in full.Confidentiality
TMA-2.1.4
The confidentiality of the
offer before an announcement must be maintained and all persons in possession of confidential information, and particularly price-sensitive information, concerning anoffer or contemplatedoffer must treat that information as secret and may only pass it to another person if it is necessary to do so and if the other person understands the need for secrecy.Amended: October 2019TMA-2.2 TMA-2.2 Independent Advice and Shareholder Approval
Appointment of Advisors by Offeree
TMA-2.2.1
A board which receives an
offer or is approached with a view to anoffer being made, must, in the interests of shareholders, appoint an independentprofessional adviser to advise the board as to whether the financial terms of theoffer is, or is not, fair and reasonable. Such advice, including reasons, must be obtained in writing and made known to shareholders by including it in theofferee board circular along with the recommendation of theofferee company’s board regarding acceptance and voting, where applicable, of theoffer . The board must announce the appointment of theprofessional adviser in the initial announcement of theoffer or possibleoffer , or as soon thereafter as the appointment is made.Amended: January 2024
Amended: January 2022
Amended: October 2019TMA-2.2.1A
For the purposes of Paragraph TMA-2.2.1, the
offeree company’s board, prior to appointment of an independentprofessional adviser , must ensure that the independentprofessional adviser has sufficient experience and a satisfactory work record in corporate finance or in a related field over the period of at least the past 5 years.Added: January 2022TMA-2.2.1B
For the purposes of Paragraph TMA-2.2.1A, a
professional adviser is considered to have the relevant corporate finance experience if it has provided advice for any of the following:a) IPOs;b) Mergers and acquisitions involving listed companies;c) Fund-raising exercise through the capital market by listed companies; and/ord) Restructuring exercises involving listed companies.Added: January 2022TMA-2.2.2
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.2.3
When it is not possible to give a recommendation or there is a divergence of views amongst board members or between offeree board and the
professional advisor , as to the merits of theoffer or recommendation being made, then it must be stated in theofferee board circular and an explanation given, including the arguments for the recommendation to shareholders with regards to acceptance or rejection of the offer. The views of any directors who are in a minority must also be included in the offeree board circular.Amended: January 2024
Amended: October 2019TMA-2.2.3A
If a director has a conflict of interest, he must not be joined with the rest of the board in the expression of their views on the
offer . The conflict must be disclosed, in the offeree board circular, to the shareholders.Added: January 2024TMA-2.2.4
[This Paragraph was deleted in October 2019].
Deleted: October 2019In-Eligible Professional Adviser(s)
TMA-2.2.5
A person shall not be appointed as an independent
professional adviser if the person is arelated company to theofferor orofferee or who has, or had, a significant connection, financial or otherwise, with either theofferor or theofferee company, or the controlling shareholder(s) of either of them, of a kind likely to create, or to create the perception of, a conflict of interest, or reasonably likely to affect the objectivity of his advice.Amended: October 2019TMA-2.2.5A
For the purposes of Paragraph TMA-2.2.5, a
professional adviser would not generally be considered independent if theprofessional adviser :(a) holds voting rights in theofferor or theofferee at any time during the preceding 12 months from the beginning of theoffer period . While determining the voting rights, shares held under trust arrangement, discretionary managed funds or other form of non-beneficial ownership by the professional adviser in theofferor orofferee company are not to be taken into consideration;(b) provides or has provided any audit and/or review services during the preceding 12 months from the beginning of theoffer period ;(c) has a business relationship with theofferor or theofferee , at any time during the preceding 12 months from the beginning of theoffer period that contributes to more than 10 per cent in revenue or profit of the adviser, based on the latest financial statements;(d) has a representative on the board of theofferor or theofferee ;(e) has a representative from either theofferor or theofferee on its board;(f) is or will be involved in the financing of the offer;(g) is a substantial creditor of either theofferor or theofferee , based on the latest financial statements; or(h) has a financial interest in the outcome of the offer other than as outlined in paragraphs TMA-2.2.5A(a)–(g) above.Added: January 2022TMA-2.2.5B
For the purposes of Paragraph TMA-2.2.5A(g), a
professional adviser would be considered to be a “substantial creditor”, if:(a) the loan (including hire purchase, leasing, corporate bonds and Islamic financing) extended by theprofessional adviser to theofferor or theofferee represents more than 10 per cent of the loan outstanding in theofferor or theofferee ; or(b) the loan (including hire purchase, leasing, corporate bonds and Islamic financing) extended by theprofessional adviser to theofferor or theofferee represents more than 10 per cent of the latest audited shareholders’ funds of theprofessional adviser ; or(c) the professional adviser is a lead banker in a syndicated loan (including Islamic financing) extended to theofferor or theofferee , at any time during the period of 12 months preceding the beginning of the offer period.Added: January 2022TMA-2.2.5C
Paragraph TMA-2.2.1 requires the
professional adviser to have a sufficient degree of independence to ensure that the advice given is proper and objective. Accordingly, in certain circumstances it may not be appropriate for aprofessional adviser who has had a recent advisory relationship with anofferor orofferee to give advice. In such cases, the CBB should be consulted. Also, aprofessional adviser may conduct functions such as corporate finance, lending, stockbroking, fund management and corporate advisory activities on a day-to-day basis quite separately within the same organisation, but it is necessary for theprofessional adviser to satisfy the CBB that it arranges its affairs to ensure that there is total and effective segregation of those operations (Chinese wall), and those operations are conducted without regard for the interests of other parts of the same organisation or of its clients.Amended: January 2024
Added: January 2022TMA-2.2.6
[This Paragraph was deleted in January 2024].
Deleted: January 2024
Amended: October 2019Independent Committee
TMA-2.2.6A
If any of the directors of an
offeree company is faced with a conflict of interest, then such directors must notify theofferee company’s board and their interest and they must not vote on the resolution to be adopted in regards of theoffer , and if possible, the offeree company board should establish an independent committee of the board to discharge the board’s responsibilities in relation to theoffer . If it is not possible to form an independent committee, responsibility for representing the interests of independent shareholders must reside primarily with theprofessional adviser . In case of doubt the CBB must be consulted.Added: January 2024TMA-2.2.7
Members of an independent committee of a company’s board of directors (established to discharge the board`s responsibilities in relation to the
offer ) must consist of non-executive directors of the company who have no direct or indirect interest in anyoffer or possibleoffer for consideration by the independent committee other than, in the case of a director of theofferee company, as a shareholder of theofferee company.Amended: January 2024
Amended: October 2019Shareholder Votes to be Conducted by Way of a Poll
TMA-2.2.8
Whenever this Module requires a matter to be approved by shareholders or any class or group thereof in general meeting the vote must be conducted by way of a poll. The results of the poll must be announced.
Amended: October 2019Approval of Delistings by Independent Shareholders
TMA-2.2.9
[This Paragraph was deleted in January 2022].
Deleted: January 2022
Amended: October 2019Board of Offeror Company
TMA-2.2.10
Where an
offeror is a listed company, and theoffer being made is a reversetakeover or when the directors of theofferor are faced with a conflict of interest, the board of theofferor must appoint an independent adviser and obtain professional independent advice as to whether the making of theoffer is in the interests of theofferor’s shareholders. The advice must be obtained before announcing an offer or revisedoffer . Theoffer or revisedoffer must also be made subject to the approval of the shareholders of theofferor in a general meeting. The advice must be in writing and sent to the shareholders with the notice of the meeting. If anofferor considers that these requirements should not apply, where for example theoffer is not material to theofferor , it may apply to the CBB for a waiver of these requirements.Amended: January 2024
Amended: October 2019TMA-2.2.10A
For the purposes of TMA-2.2.10, a conflict of interests, amongst others, includes:
a) significant cross shareholdings (10% or more) between an offeror and the offeree company;b) a number of directors common to both companies; orc) a commoncontrolling shareholder in both companies is a director of or has a nominee director in either company.Added: January 2024TMA-2.2.11
[This Paragraph was deleted in January 2024].
Deleted: January 2024
Amended: October 2019TMA-2.2.12
[This Paragraph was deleted in January 2024].
Deleted: January 2024
Amended: October 2019TMA-2.2.13
[This Paragraph was deleted in January 2024].
Deleted: January 2024
Amended: October 2019TMA-2.3 TMA-2.3 Announcement of Offer or Possible Offer
Announcement to be Made by Offeror
TMA-2.3.1
Except in the case of a
mandatory offer where any of the circumstances occurring in TMA-2.3.10, a brief announcement that a potentialofferor is considering making anoffer must be made after obtaining permission from the CBB.TMA-2.3.2
Before the board of the
offeree company is approached, the responsibility for making an announcement lies with theofferor or potentialofferor . Theofferor or potentialofferor should, therefore, keep a close watch on theofferee company's share price and volume for signs of unusual movement.Amended: October 2019Announcements to be Made by Potential Vendor
TMA-2.3.3
The potential vendor must make an announcement when there are negotiations or discussions between a potential
offeror and the holder, or group of holders, of shares carrying 30% or more of the voting rights of the company and the company is subject to rumour or speculation about a possibleoffer or there is unusual movement in its share price or in the volume of share turnover, and there are reasonable grounds for concluding that it is the potential vendor's actions which have led to the situation.Amended: October 2019Suspension of Trading
TMA-2.3.4
When an announcement is required under this Section, the listed company(ies) being the
offeror or theofferee company, as the case may be, must notify the CBB and thelicensed exchange immediately that an announcement is imminent and if there is any possibility that an uninformed market for shares of theofferor or theofferee company could develop prior to publication of the announcement, serious consideration must be given to requesting a suspension of trading in such shares pending publication of the announcement. A potential offeror must not attempt to prevent the board of theofferee company from making an announcement or requesting thelicensed exchange to grant a temporary suspension of trading at any time the board thinks appropriate. The CBB or thelicensed exchange may, at their discretion and irrespective of whether or not there is a request, suspend trading temporarily on the shares of a listed company being anofferee orofferor .Amended: October 2019Announcements of Certain Purchases
TMA-2.3.5
Acquisitions of
voting rights of the offeree company by anofferor or by any personacting in concert with theofferor may give rise to an obligation to make a cash offer, to increase anoffer or to make amandatory offer . Immediately after any acquisition giving rise to any such obligation, an announcement must be made, stating the number of shares acquired and the price paid, together with the information required (to the extent that it has not previously been announced).Amended: October 2019TMA-2.3.6
CBB should be consulted if an
offeror is wishing to approach a wider group, for example in order to arrange financing for theoffer , whether through equity or debt, or to organize a consortium to make theoffer .TMA-2.3.7
Where the
offeror orofferee does not make an announcement when obliged to do so in terms of this Module, the CBB shall have the right to, without prejudice to any further action imposed by the CBB, instruct theofferor and theofferee to make an announcement in accordance with this Module and theofferor orofferee must comply with the time stipulated in the instruction.Amended: October 2019Publication of an Announcement about an Offer or Possible Offer
TMA-2.3.8
When an
offer or possibleoffer is announced, the announcement must be in accordance with Appendix B in Part B of the CBB Rulebook Volume 6 and be sent to thelicensed exchange and published in two local daily newspapers in Bahrain, one in Arabic, or Arabic and the other in English.Amended: October 2019TMA-2.3.9
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.3.10
An
offeror or potentialofferor must make an announcement under the following conditions:(a) Before an approach has been made to theofferee company, theofferee company is in the subject of rumour or speculation about a possibleoffer .(b) There is unusual movement in the company's share price or in the volume of share turnover, and there are reasonable grounds for concluding that it is the actions of the potentialofferor or personsacting in concert with it through inadequate security, which have led to the situation;(c) When negotiations or discussions are about to be extended to include more than a very restricted number of persons; outside those who need to know in the companies concerned and their immediate advisors; or(d) Immediately upon acquisition of voting rights which gives rise to an obligation to make amandatory offer . The announcement that an obligation has arisen must not be delayed due to information being obtained, additional information can be the subject of a later supplementary announcement.Amended: October 2019Announcement to be Made by Offeree
TMA-2.3.11
Following an approach to the board of the
offeree company which may or may not lead to anoffer , the primary responsibility for making an announcement will normally rest with the board of theofferee company. Theofferee company must, therefore, keep a close watch on its share price and volume.The board of the
offeree company must make an announcement to thelicensed exchange and market and inform its shareholders immediately upon the occurrence of the following conditions:(a) A firm intention to make anoffer has been notified to the board of theofferee company from an authorised source, irrespective of the attitude of the board of theofferee company;(b) When following an approach to theofferee company, whether there is a firm intention to make anoffer or not, theofferee company is the subject of rumour or speculation about a possibleoffer or there is unusual movement in its share price or in the volume of share turnover;(c) When negotiations or discussions about a potentialoffer are about to be extended to include more than a very restricted number of persons;(d) When the board of a company is aware that there are negotiations or discussions between a potentialofferor and the holder, or group of holders of shares carrying 30% or more of the voting rights of a company; or(e) When the board of a company is seeking potentialofferor s, and(i) The company is the subject of rumour or speculation about a possibleoffer , or there is unusual movement in its share price or a significant increase in the volume of share turnover; or(ii) More than a very restricted number of potential purchasers orofferor are about to be approached.Amended: October 2019
Amended: April 2013TMA-2.3.12
When a proposed
offer is conditional on acceptances or undertakings to accept by one or more shareholders, the proposed announcement must include a statement by those shareholders who have accepted or undertaken to accept theoffer , whether such acceptances or undertakings are revocable, and if so, the conditions under which such acceptances or undertakings may be revoked.Amended: October 2019Firm Intention to Make an Offer by Offeror
TMA-2.3.13
An
offeror must announce a firm intention to make anoffer where suchofferor has every reason to believe that it can and will continue to be able to implement theoffer .Amended: October 2019TMA-2.3.14
The announcement of a firm intention to make an
offer must state the following:(a) Terms of theoffer ;(b) Identity of theofferor and, where theofferor is a company, the identity of its ultimate controlling shareholder and the identity of its ultimate parent company, or where there is a listed company in the chain between such company and its ultimate parent company, the identity of such listed company;(c) Details of any existing holding of shares and rights over shares in theofferee company:(i) Which theofferor owns or over which it has control or direction;(ii) Which is owned or controlled or directed by any person acting in concert with theofferor ;(iii) In respect of which theofferor or any personacting in concert with it has received an irrevocable commitment to accept theoffer ; and(iv) In respect of which theofferor or any personacting in concert with it holds convertible securities, warrants or options;(d) Details of any outstanding derivative in respect of securities in theofferee company entered into by theofferor or any personacting in concert with it;(e) All conditions (including normal conditions relating to acceptance, listing and change in capital) to which theoffer is subject;(f) Details of any arrangement (whether by way of option, indemnity or otherwise) in relation to shares of theofferor or theofferee company and which might be material to theoffer . Details of any relevant securities of theofferee company in which theofferor or any personacting in concert with it has an interest or has a right to subscribe. In each case, the nature of the interests or rights concerned needs to be specified;(g) Details of any relevant securities of theofferee company which theofferor or any person acting in concert with it has borrowed or lent, save for any borrowed shares which have been either on-lent or sold;(h) All conditions (including normal conditions relating to acceptances, admission to listing, admission to trading and increase of capital) to which theoffer or the posting of it is subject;(i) Details of any agreements or arrangements to which theofferor is party which relate to the circumstances in which it may or may not invoke or seek to invoke a pre-condition or the consequences of its doing so, including details of any break fees payable as a result; and(j) Details of any arrangement for the payment of an inducement fee or similar arrangement.Amended: October 2019
Amended: April 2013TMA-2.3.15
Where the
offer is for cash, or includes an element of cash, the announcement of firm intention must include a statement by an adviser, or another appropriate third party, that they have carried out necessary assessment to confirm that sufficient resources are available to theofferor to satisfy the full implementation and acceptance of theoffer .Amended: January 2022
Amended: October 2019TMA-2.3.15A
For the purpose of Paragraph TMA-2.3.15, the CBB may require the appointed adviser or third party to provide evidence in support of the confirmation statement referred to in Paragraph TMA-2.3.15 confirming that sufficient resources are available to satisfy the
offeror’s obligation in respect of theoffer .Added: January 2022TMA-2.3.16
Except with the consent of the CBB, if an incorrect or misleading statement is made in an announcement by the potential
offeror , or on behalf of the potentialofferor , or its directors, or officials or advisors, and not immediately withdrawn, then the potentialofferor will be bound by the statement if anoffer for theofferee company is subsequently made.TMA-2.3.17
Except with the consent of the CBB, where the incorrect or misleading statement concerned relates to the price of a possible
offer (or a particular exchange ratio in the case of a proposed securities exchangeoffer ), the potentialofferor will not be allowed subsequently to make anoffer for theofferee company at a lower price (taking the price of any securities concerned at the date of announcement of the firm intention to make theoffer ), unless there has occurred an event which the potentialofferor specified in the statement as an event which would enable it to be set aside.Preconditions
TMA-2.3.18
Any pre-conditions included in an announcement to making a possible
offer must be agreed in advance by the CBB and clearly state whether or not the pre-conditions must be satisfied before anoffer can be made or whether they are waived.Announcement of the Progress of the Offer
TMA-2.3.19
Until a firm intention to make an
offer has been notified a brief announcement by a potentialofferor or theofferee company that talks are taking place or that a potentialofferor is considering making anoffer will normally satisfy the obligations under this Section.If following the announcement of a possible
offer no further announcement has been made in respect of thatoffer or possibleoffer within one month, an announcement must be made setting out the progress of the talks or the consideration of a possibleoffer . This obligation continues, and announcements will be required monthly, until announcement of firm intention to make anoffer or of a decision not to proceed with anoffer . When talks are terminated or a potentialofferor decides not to proceed with anoffer , clear and unambiguous announcement must be made to that effect.Amended: October 2019Statements of Intention Not to Make an Offer
TMA-2.3.20
A person making a statement that he does not intend to make an
offer for a company must make a statement to the market that is very clear and unambiguous.Amended: October 2019TMA-2.3.21
Except with the consent of CBB, unless there has been a material change of circumstances or an event has occurred which the person specified in his statement as an event which would enable it to be set aside, neither the person making the statement, nor any person
acting in concert with him, nor any person who is subsequentlyacting in concert with either of them, may within six months from the date of the statement:(a) Announce anoffer or possibleoffer for theofferee company, including apartial offer ;(b) Acquire any interest in shares of theofferee company if any such person is obliged under TMA-3.1 to make a mandatoryoffer ;(c) Acquire any interest, or procure an irrevocable commitment in respect of, shares of theofferee company if the shares in which such person, together with any personsacting in concert with him, would be interested and the shares in respect of which he, or they, had acquired irrevocable commitments would in aggregate carry 30% or more of the voting rights of theofferee company;(d) Make any statement which raises or confirms the possibility that anoffer might be made for theofferee company; or(e) Proceed with actions to make a possibleoffer , for theofferee company, where knowledge of the possibleoffer might be extended outside the potentialofferor and immediate advisors.Amended: October 2019TMA-2.3.22
Failure to comply with this rule may lead to the period of six months set out to be extended.
TMA-2.3.23
Any person considering issuing a statement of an intention not to make an
offer should consult CBB; particularly when specific reservations are to be included or to be set aside.TMA-2.3.24
Restrictions imposed by TMA-2.3.21 on statements made will apply to any persons
acting in concert with the person making the statement. Unless clear in the statement or at the time of the statement, the restrictions will not apply to the personsacting in concert and that they are continuing to consider making anoffer .Amended: October 2019TMA-2.3.25
When a person is announcing in a statement an intention of not making an
offer , CBB will take into account the manner of any public reporting following the statement. Advisors should advise the directors and officials of companies of the implications of TMA-2.3.21.TMA-2.4 TMA-2.4 No Frustrating Action
TMA-2.4.1
Once a bona-fide
offer has been communicated to the board of anofferee company or the board of anofferee company has reason to believe that a bona-fideoffer may be imminent, no action which could effectively result in anoffer being frustrated, or in the shareholders of theofferee company being denied an opportunity to decide on the merits of anoffer , shall be taken by the board of theofferee company in relation to the affairs of the company without the approval of the shareholders of theofferee company in general meeting. In particular theofferee company's board must not, without such approval, do or agree to do the following:(a) Issue any shares;(b) Create, issue or grant, or permit the creation, issue or grant of, any convertible securities, options or warrants in respect of shares of theofferee company;(c) Other than during the normal course of business, sell, dispose of or acquire assets of a material amount;(d) Enter into contracts, including service contracts, otherwise than in the ordinary course of business; or(e) Cause theofferee company or any subsidiary or associated company to purchase or redeem any shares in theofferee company or provide financial assistance for any such purchase.TMA-2.4.2
For purposes of Paragraph TMA-2.4.1, where the
offeree company is under a prior contractual obligation to take any such action, or where there are other special circumstances, the CBB must be consulted at the earliest opportunity.Amended: October 2019TMA-2.5 TMA-2.5 No Withdrawal of an Offer
TMA-2.5.1
Except with the consent of the CBB, following an announcement of a firm intention to make an
offer , theofferor cannot withdraw theoffer and must continue to implement it unless theoffer is subject to the fulfilment of a specified condition and the condition has not been met.TMA-2.5.2
A change in general economic, industrial or political circumstances will not justify failure to proceed with an announced
offer , unless circumstances of an exceptional and specific nature arise.TMA-2.5.3
If a competitor has posted a higher
offer to the one already made by the firstofferor , the CBB may consent to the withdrawal of the announcedoffer . This should not carry any additional conditions other than those necessary for the implementation of such announcedoffer .TMA-2.5.4
If an
offeror is permitted to withdraw from anoffer , or anoffer is waived because of non-fulfilment of a condition, theofferor will be required to make an announcement giving reasons for the withdrawal.TMA-2.5.5
The CBB may seek to hear views of the
offeree company and its advisors, prior to consenting to a withdrawal of an announcedoffer .TMA 2.6 TMA 2.6 Information to Offeror(s)
TMA-2.6.1
Upon signing a confidentiality agreement to give access to any due diligence material, any information, including particulars of shareholders, given to one
offeror or potentialofferor must be furnished equally and promptly to any other bona fideofferor or potentialofferor .Amended: October 2019TMA-2.6.2
If the
offer or potentialoffer is a management buy-out or similar transaction, the information which this Paragraph requires to be given to a competing or potentialofferor is:(a) The information generated by theofferee company (including the management of theofferee company acting in their capacity as such) which is passed to external providers or potential providers of finance (whether equity or debt) to theofferor or potentialofferor ; and(b) Any other information that is material in the context of making anoffer insofar as the board of theofferee company is aware that the management is in possession of such information.This, however, does not include providing information on the
offeree company's trade and business secrets. The CBB expects the directors of theofferee company who are involved in making theoffer to cooperate with the independent directors of theofferee company and its advisers in the assembly of information.Amended: October 2019
Amended: April 2013TMA-2.6.3
The information related to an
offer should be provided by theofferee company to the ultimateofferor or potentialofferor , the identity of which must be disclosed to the directors of theofferee company.Amended: October 2019Mutual Due Diligence Review
TMA-2.6.4
Where the consideration under an
offer includes exchange of securities, theofferor and theofferee company may, subject to such terms and conditions as may be agreed between theofferor andofferee company under a confidentiality agreement, undertake mutual due diligence (mutual due diligence review) of each other's business.Added: October 2019TMA-2.6.5
Where the CBB is of the opinion that mutual due diligence review as referred to in Paragraph TMA-2.6.4 is in the best interest of the shareholders, it may, at its sole discretion, by notice in writing, order the
offeror and theofferee company to enter into a mutual due diligence review agreement.Added: October 2019TMA 2.7 TMA 2.7 Timing and Content of Documents
Equality of Information to Shareholders
TMA-2.7.1
All
offeree company shareholders must be given sufficient information and advice about anoffer . Information must be made equally available to all shareholders, at the earliest and in the same manner to enable them to reach an informed decision about theoffer .Amended: October 2019TMA-2.7.2
Shareholders must, in accordance with Appendix C in Part B of the CBB Rulebook Volume 6, be given all the facts necessary to make an informed judgment on the merits or demerits of an
offer . Such facts require accurate and fair presentation and must be given to the shareholders early enough to enable them to make a decision in good time. The obligation of theofferor in these respects towards the shareholders of theofferee company is no less than theofferor's obligation towards its own shareholders. In particular, whether or not theoffer consideration is cash, information must be given about theofferor .Amended: October 2019TMA-2.7.3
The
offer document must include a heading stating: "If you are in doubt about any aspect of thisoffer , you should consult a licensed securities dealer or licensed institution in securities, a bank manager, solicitor or attorney, professional accountant, or other professional advisor."TMA-2.7.4
No new material must be released in meetings, interviews or discussions with the media. If any new information is made public as a result of meetings, interviews or discussions with the media, then a circular must be sent to shareholders and where appropriate newspaper space.
Amended: October 2019Subsequent Documents
TMA-2.7.5
Documents subsequently sent to shareholders of the
offeree company must contain details of any material changes in information previously submitted or published by or on behalf of either party during theoffer period . If there have been no such changes this must be stated. In particular, the following matters must be updated:(a) Changes or additions to material contracts;(b) Shareholdings and dealings;(c) Changes to directors' service contracts;(d) Special arrangements;(e) Ultimate owner of securities acquired under theoffer ; and(f) Arrangements in relation to dealings.Amended: October 2019
Amended: April 2013Offer Document Time Limit
TMA-2.7.6
The
offer document must be sent to theofferee company by or on behalf of theofferor within 21 calendar days of the date of the announcement of the terms of theoffer . The CBB's consent is required if theoffer document may not be posted within this period.Amended: October 2019Timing and Contents of Offeree Board Circular
TMA-2.7.7
The
offeree company must send the circular containing the information in Appendix D in Part B of the CBB Rulebook Volume 6, together with any other information it considers to be relevant to enable its shareholders to reach an informed decision on theoffer accompanied by theoffer document to all its shareholders within a maximum period of 21 calendar days from the date of receipt of theoffer document . The CBB’s written approval is required if theofferee board circular may not be sent to the shareholders within the abovementioned period. Theofferee board circular must include the views of theofferee company’s board or its independent committee on theoffer and the written advice of itsprofessional adviser as to whether theoffer is, or is not, fair and reasonable and the reasons thereof.Amended: January 2022
Amended: October 2019TMA-2.7.8
[This Paragraph was deleted in January 2022]
Deleted: January 2022
Amended: October 2019Prospectus Standard
TMA-2.7.9
Each document issued or statement made in relation to an
offer or possibleoffer or during anoffer period must, as is the case with a prospectus, satisfy the highest standards of accuracy and the information given must be adequately and fairly presented. This applies whether theofferor , theofferee company, or any of their advisors or agents issues the document, advertisement, or announcement. Those who issue or make any such document or statement must ensure that it remains accurate and up-to-date throughout theoffer period , and must notify shareholders of any material changes as soon as possible.Amended: October 2019Directors' Responsibility Statement
TMA-2.7.10
All documents must state on the inside cover page that: All directors of the company issuing the document, whose names appear therein, jointly and severally accept full responsibility for the accuracy of information contained in the document. To the best of the knowledge and belief of the directors, who have taken all reasonable care to ensure that such is the case, the information contained in the document is in accordance with the facts and contains no omissions likely to affect the importance and completeness of the document.
Amended: October 2019TMA-2.7.11
If it is proposed that any director be excluded from the Director's Responsibility Statement, the CBB's consent is required. Such consent is given only in exceptional circumstances and in such cases the omission and the reasons for it must be stated in the document to which the Director's Responsibility Statement applies.
Amended: October 2019TMA-2.7.12
The directors of the
offeree company should comment on the statement in theoffer document regarding theofferor's intentions in respect of theofferee company and its employees.Arabic/English Language
TMA-2.7.13
Each document must be written in Arabic and/ or English and shall include or be accompanied by a translation, as the case requires, in Arabic or English.
Amended: October 2019Documents to be on Display
TMA-2.7.14
Except with the consent of the CBB, the following documents must be available for inspection from the time that the
offer document or theofferee board circular is published, until the end of theoffer period . Theoffer document and theofferee board circular must state which documents are available and where, and the place where inspection can be made:(a) Memorandum and articles of association of theofferor or theofferee company or equivalent documents;(b) Audited consolidated accounts of theofferor or theofferee company for the last two financial years for which these have been published in accordance with the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) or other accounting standards acceptable to the CBB;(c) All service contracts ofofferee company directors;(d) Any report, letter, valuation or other document any part of which is exhibited or referred to in any document issued by or on behalf of theofferor or theofferee company;(e) Written consents of theprofessional advisers ;(f) All material contracts in relation to theoffer ;(g) Where a profit forecast has been made, the reports of the auditors or consultant accountants and of theprofessional advisers in addition to the letters giving the consent of the auditors or consultant accountants and of theprofessional advisers to the issue of the relevant document with the report in the form and context in which it is included or, if appropriate, to the continued use of the report in a subsequent document;(h) Where an asset valuation has been made, the valuation certificate and associated report containing details of the aggregate valuation, in addition to a letter stating that the valuer has given and not withdrawn his consent to the publication of his name in the relevant document;(i) Any document evidencing an irrevocable commitment or a letter of intent which has been procured by theofferor orofferee company (as appropriate) or any of their respectiveassociates ;(j) Where the CBB has given consent to aggregation of dealings, a full list of all dealings;(k) Documents relating to the financing arrangements for theoffer or a detailed statement from the professional advisor indicating that they have taken all reasonable steps to convince themselves that sufficient resources are available to implement theoffer ;(l) Documents relating to the payment of an inducement fee or similar arrangement;(m) Any agreements or arrangements, or, if not reduced to writing, a memorandum of all the terms of such agreements or arrangements, disclosed in theoffer document ; and(n) Any agreements or arrangements, or, if not reduced to writing, a memorandum of the terms of such agreements or arrangements.Amended: October 2019TMA-2.8 TMA-2.8 The Offeree's Director Responsibilities
TMA-2.8.1
The board of directors of the
offeree company must ensure that proper arrangements are in place to enable it to monitor all aspects relating to the offer to ensure that:(a) The board is provided promptly with copies of all documents and announcements issued by or on behalf of the offeree company which bear on theoffer ; the board receives promptly details of all dealings in relevant securities made by the offeree company or itsassociates and details of any agreements, understandings, guarantees, expenditure (including fees) or other obligations entered into or incurred by or on behalf of the offeree company in the context of theoffer which do not relate to routine administrative matters;(b) Those directors or committee members (appointed in accordance with Paragraph TMA-2.2.7) who undertake daily responsibilities for theoffer are in a position to justify to the board all their actions and proposed courses of action;(c) The opinions of advisers, including professional advisers, are available to the board; and(d) The possible temporary insiders (including members of the board themselves) are identified and that theofferee company (including its employees) comply with the relevant provisions of Insiders as stipulated in the CBB Law and in theofferee’s policy oninsiders .Amended: January 2022
Amended: October 2019
Amended: April 2013TMA-2.8.2
The procedures identified in TMA-2.8.1 must be followed, and board meetings must be held, whenever necessary throughout the offer in order to ensure that all directors remain updated with events and with actions taken.
Amended: October 2019TMA-2.8.3
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.8.4
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.8.5
Where directors (including their connected persons, related trusts and companies controlled by such directors, connected persons and related trusts) or shareholders or groups of shareholders acting collectively holding effective control, whether represented on the board or not, sell shares to a purchaser, as a result of which the purchaser is required to make an
offer under TMA-3.1 (Mandatory Offer), the vendors must ensure that as a condition of the sale the purchaser undertakes his obligations in accordance with TMA-3.1 .Amended: October 2019Resignation of Directors of Offeree Company
TMA-2.8.6
Once a bona-fide
offer has been communicated to the board of theofferee company or the board of theofferee company has reason to believe that a bona-fideoffer is imminent, except with the consent of the CBB, the directors of anofferee company or any of its subsidiaries must not resign until the first closing date of theoffer , or the date when theoffer becomes or is declared unconditional, whichever is the later. Resignation of directors of theofferee company must be made in accordance with theofferee company's Memorandum and Articles of Association.Amended: October 2019Prompt Registration of Transfers
TMA-2.8.7
The board and officials and registrars of an
offeree company should use their best endeavours to ensure the prompt registration of transfers during anoffer period so that shareholders can freely exercise their voting and other rights.Added: October 2019TMA-2.9 TMA-2.9 Profit Forecast and Other Financial Information
TMA-2.9.1
The directors are responsible for ensuring that the profit forecasts are compiled with the highest standards, presentation and accuracy to shareholders in an
offer . Financial advisors must ensure that the directors are preparing the forecasts with sufficient explanation on how the projection was calculated, taking into account all the assumptions and risk of failure in the projected result. Such project must be examined and reported on by independent reporting accountants, experts, or consultants in accordance with the applicable international standard (International Standard on Assurance Engagement — ISAE).TMA-2.9.2
Profit forecasts provided by the
offeror and/or theofferee must include:(a) A profit forecast for the current financial year. If the forecast year is less than three months of the current financial year, then the period of the forecast will be the current financial year and the next immediate financial year;(b) The assumptions, in addition to the commercial assumptions, on which the forecasts are based must be included in documents sent toofferee shareholders with regards to anoffer ;(c) A statement with the consent of the relevant advisors, including the consultant accountant and professional advisor, that they have given and not withdrawn their consent to the publication of the profit forecast;(d) A statement by the directors that the forecast remains valid for the purpose of theiroffer and that the professional advisors and accountants who reported the forecast agree that their reports continue to apply;(e) The accounting policies and calculations of the forecasts which have been examined and reported on by the auditors, consultant accountants or any other professional advisor of theofferor or theofferee ; and(f) When a profit forecast is made in relation to a period in which trading has already commenced, any previously published profit figures in respect of any expired part of that trading period, together with comparable figures for the same part of the preceding year.Amended: October 2019TMA-2.9.3
When income from land and buildings is a material element in a forecast, that part of the forecast must normally be examined and reported on by an independent valuer. Exceptional items should also be examined and reported on with special care.
Amended: October 2019TMA-2.9.4
Except with the consent of the CBB, any profit forecast which has been made before the commencement of the
offer period must be examined, reproduced and reported on in the document sent to shareholders.Amended: October 2019TMA-2.9.5
Exceptionally, the CBB may accept that, because of the uncertainties involved, it is not possible for a forecast previously made to be reported on in accordance with this Module nor for a revised forecast to be made. In these circumstances, the CBB would insist on shareholders being given a full explanation as to why the requirements of this Module were not capable of being met.
Publication of Reports
TMA-2.9.6
When a profit forecast is made during an
offer period , any documents sent to shareholders must include the forecast reports as required by TMA-2.9.2(e), TMA-2.9.3 and TMA-2.9.4. The reports must include a statement that consent has been given and has not been withdrawn to the circulation to shareholders.Amended: October 2019TMA-2.9.7
If a company's forecast is published first in a press announcement, it must be repeated in full, together with the reports required in TMA-2.9.2(e), TMA-2.9.3 and TMA-2.9.4, in the documents sent to shareholders. The reports must include a statement that consent has been given and has not been withdrawn to the publication.
Amended: October 2019Continuing Validity of Forecast
TMA-2.9.8
When a company includes a forecast in a document, any document subsequently sent out by that company in connection with that
offer must, contain a statement by the directors that the forecast remains valid for the purpose of theoffer and that theprofessional advisers and accountants who reported on the forecast have indicated that they have no objection to their reports continuing to apply.Amended: October 2019Statements Which will be Treated as Profit Forecasts
TMA-2.9.9
When no particular figure is mentioned or even if the word "profit" is not used, certain forms of words may constitute a profit forecast, particularly when considered in context. Examples are "profits will be somewhat higher than last year" and "performance in the second half-year is expected to be similar to our performance and results in the first half-year" (when interim figures have already been published). Whenever a form of words puts a floor under, or a ceiling on, the likely profits of a particular period or contains the data necessary to calculate an approximate figure for future profits, it will be treated by the CBB as a profit forecast which must be reported on. In cases of doubt, the CBB should be consulted in advance.
TMA-2.9.10
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.9.11
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.9.12
[This Paragraph was deleted in October 2019].
Deleted: October 2019When a Forecast Relates to a Period which has Commenced
TMA-2.9.13
[This Paragraph was deleted in October 2019].
Deleted: October 2019Merger Benefits Statements in Securities Exchange Offers
TMA-2.9.14
In a
securities exchange offer , a quantified statement about the expected financial benefits of a proposedtakeover ormerger is deemed to be a profit forecast statement for the purpose of this TMA-2.9. In addition to satisfying the existing standards of information and requirements under the TMA Module, a person issuing such a statement must provide:(a) The basis of the belief (including sources of information) supporting the statement;(b) An analysis and explanation of the constituent elements sufficient to enable shareholders to understand the relative importance of these elements; and(c) A base figure for any comparison drawn.Amended: October 2019
Amended: April 2013TMA-2.10 TMA-2.10 Asset Valuation
TMA-2.10.1
When a valuation of assets is given in connection with an
offer , it must be supported by the opinion of a named independentvaluer who has no connection with other parties to the transaction. Asset valuations by a professionally qualified independent valuer must be provided when asset values are a particularly significant factor in assessing the relevanttakeover ormerger transaction.Amended: October 2019TMA-2.10.2
Valuation of assets documents provided by the
offeror or theofferee must include:(a) The professional qualifications and address of the independent valuer;(b) The basis of valuation;(c) The opinion of the independent valuer supporting the valuation;(d) The effective date at which the assets were valued. If a valuation is not current, the valuer must state that a current valuation would not be materially different and if this statement cannot be made, the valuation must be updated;(e) A statement with the consent of the valuer that he has given and not withdrawn his consent to the use of his valuation report.TMA-2.10.3
Valuation report addressed to shareholders must be made available for inspection together with an associated report containing details of the aggregate valuation. Where CBB is satisfied that such disclosure may be commercially disadvantageous to the company concerned, it will allow the report to be in a summarized form.
Basis of Valuation
TMA-2.10.4
In any valuation of an asset or business the basis of valuation must be clearly stated. Only in exceptional circumstances should it be qualified and in that event the valuer must explain the meaning of the words used. The material assumptions made in a valuation must be stated in the valuation.
Amended: October 2019TMA-2.10.5
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.10.6
In the case of land currently being developed or with immediate development potential, in addition to giving the open market value in the state existing at the date of valuation, the valuation should include:-
(a) The value after the development has been completed;(b) The estimated total cost, including carrying charges, of completing the development and the anticipated dates of completion and of letting or occupation; and(c) A statement whether planning or other regulatory consent has been obtained and, if so, the date thereof and the nature of any conditions attaching to the consent which affect the value.However, the value of the property should also be given as a net of any charges, levy, tax, etc.
Amended: April 2013Opinion and Consent Letters
TMA-2.10.7
Standards of care; A valuation must be made with due care and consideration by the valuer or
professional adviser making the valuation.Amended: October 2019TMA-2.10.8
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.10.9
When the valuer withdraws its written consent, the document must state such fact.
TMA-2.10.10
[This Paragraph was deleted in October 2019].
Deleted: October 2019[This Subsection was deleted in October 2019]
TMA-2.10.11
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.11 TMA-2.11 Issuance of Documents
Filing of Documents for Comments
TMA-2.11.1
All documents must be filed with the CBB for its feedback prior to release or publication and must not be released or published until the CBB has issued its written approval within 10 working days thereon. The final copy of the documents must be filed with the CBB.
Amended: January 2022Publication of Documents
TMA-2.11.2
All announcements in respect of listed companies must be made in accordance with the requirements of the Disclosure Standards. All announcements in respect of unlisted companies must be circulated to their shareholders.
[This Subsection was deleted in October 2019]
TMA-2.11.3
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.12 TMA-2.12 Offers for More than One Class of Equity Shares
TMA-2.12.1
Where a company has more than one class of equity share capital, a comparable
offer must be made for each class whether such capital carries voting rights or not. The comparableoffer or proposal for each class of share capital required must normally be subject to similar conditions. Such a scheme must be considered at separate meetings for each class of the equity share capital, if required by law or the company's Memorandum and Articles of Association.Amended: October 2019TMA-2.13 TMA-2.13 Appropriate Offers for Convertibles
Offeree Companies with Convertible Securities
TMA-2.13.1
Where an
offer is made for equity share capital and theofferee company has convertible securities outstanding, theofferor must make an appropriateoffer or proposal to the holders of the convertible securities to ensure that their interests are safeguarded. Holders ofconvertible securities must be treated equally.Amended: October 2019Professional Independent Advice
TMA-2.13.2
The board of the
offeree company must obtain professional independent advice in writing on theoffer or proposal to the holders of convertible securities and the substance of such advice must be made known to all holders of its securities, together with the board's views on theoffer or proposal.Amended: October 2019Dispatch of Appropriate Offers
TMA-2.13.3
Whenever practicable the
offer or proposal should be dispatched to the holders of convertible securities at the same time that theoffer document is posted to other shareholders, but if this is not practicable the CBB should be consulted and theoffer or proposal should be dispatched as soon as possible thereafter.Amended: October 2019Conditions of Appropriate Offers
TMA-2.13.4
The
offer or proposal required by TMA-2.13.1 must be made conditional on theoffer for equity share capital becoming or being declared unconditional and should not normally be subject to any other conditions. It may, however, be put by way of a scheme to be considered at a meeting of the holders of convertible securities in accordance with the Memorandum and Articles of Association and/oroffer documents in respect of such securities, as the case may be.Amended: October 2019Warrants, Options and Subscription Rights
TMA-2.13.5
The provision of Paragraph TMA-2.13.1 applies also when an
offeree company has warrants, options or subscription rights outstanding in respect of any class of equity share capital (including non-transferable options), with the appropriate amendments.Amended: October 2019TMA-2.14 TMA-2.14 Offer Timetable
Offer to Remain Open for 15 Days
TMA-2.14.1
[This Paragraph was moved to TMA-2.14.2A in October 2019].
Amended: October 2019TMA-2.14.2A
Where a conditional
offer becomes or is declared unconditional, it must remain open for acceptance for not less than 15 calendar days thereafter.Added: October 2019Offering Period
TMA-2.14.2
Where an
offer document and theofferee board circular are distributed on different dates, theoffer must initially be open for acceptance for at least 15 calendar days following the date on the later date in respect of which the document is posted.In any announcement of an extension of an
offer , the next closing date must be stated.Amended: October 2019Final Day Rule
TMA-2.14.3
Except with the consent of the CBB, an
offer (whether revised or not) may not become or be declared unconditional as to acceptances after the official working hours on the 60th day after the day the initialoffer document was posted. The CBB's consent will normally be granted only if a competingoffer has been announced (in which case both or allofferors will normally be bound by the timetable established by the posting of the competingoffer document which is posted later).The consent of the CBB, in such cases, will only be given in very exceptional circumstances.Amended: October 2019Compulsory Acquisition
TMA-2.14.4
[This Paragraph was deleted in January 2022].
Deleted: January 2022
Amended: October 2019Time for Fulfillment of all other Conditions
TMA-2.14.5
Except with the consent of the CBB, all conditions must be fulfilled or the
offer must lapse within 15 calendar days of the first closing date or of the date theoffer becomes or is declared unconditional as to acceptances, whichever is the later.Amended: October 2019TMA-2.15 TMA-2.15 Revised and Alternative Offers
Offer Open for 15 Calendar Days after Revision
TMA-2.15.1
If, in the course of an
offer , theofferor revises its terms, allofferee company shareholders, whether or not they have already accepted theoffer , will be entitled to the revised terms. A revisedoffer must be kept open for at least 15 calendar days following the date on which the revisedoffer document is posted. Therefore, no revisedoffer document may be posted in the 15 calendar days ending on the last day theoffer is able to become unconditional as to acceptances.Amended: October 2019New Conditions for Improved Offers
TMA-2.15.2
An
offeror may introduce new improved conditions to be attached to a revisedoffer , but only to the extent necessary to implement the revisedoffer and subject to the consent of the CBB.Amended: October 2019Reintroduction of Alternative Offers
TMA-2.15.4
Where a firm statement has been made that an alternative
offer will not be extended or reintroduced, neither that alternative, nor any substantially similar alternative, may be extended or reintroduced. Where, however, such a statement has not been made and an alternativeoffer has closed, anofferor will not be precluded from reintroducing that alternative at a later date. Reintroduction constitutes a revision of theoffer and is, therefore, subject to the requirements of, and only permitted as provided in, this Section.Amended: October 2019TMA-2.15.5
CBB must be consulted if a competitive situation continues to exist in the later stages of the
offer period . CBB will normally consider applying a procedure to resolve the situation which is agreed between competingofferors and the board of theofferee company.TMA-2.16 TMA-2.16 Acceptors' Right to Withdraw
TMA-2.16.1
An acceptor will be entitled to withdraw his acceptance after 14 days from the first closing date of the
offer , if theoffer has not become unconditional as to acceptances by that date. Such entitlement to withdraw will be exercisable until theoffer becomes unconditional as to acceptances. However, on the 60th day (or any date beyond which theofferor has stated that itsoffer will not be extended) the final time for the withdrawal must coincide with the final time for the lodgement of acceptances.Amended: October 2019TMA-2.17 TMA-2.17 Statements during Course of Offer
TMA-2.17.1
Information, documents, advertisements or statements issued during an
offer period must not be misleading and must be of the highest standard and accuracy. This is whether the information is issued directly by theofferor ,offeree or by the advisors. All parties and their advisers are responsible for ensuring that any release of information abides with this rule.TMA-2.17.2
Any parties of an
offer or potentialoffer and their advisors must take care not to issue any statements which, while not factually inaccurate, may mislead shareholders and the market and cause uncertainty. Statements regarding anofferor improving hisoffer without committing itself to doing so must not be made.TMA-2.17.3
Documents issued to shareholders or advertisements published in relation to an
offer by, or on behalf of, theofferor or theofferee company, must state where appropriate, that the directors of theofferor and/or theofferee company accept full responsibility for the information contained in the documents and advertisements, to the best of their knowledge, that the information contained in the document or advertisement is in accordance with the facts and that it contains no omissions likely to affect the importance and consistencies of the document.No Extension Statements
TMA-2.17.4
If statements in relation to the duration of an
offer such as "theoffer will not be extended beyond a specified date unless it is unconditional as to acceptances" ("no extension statements") are included in documents sent toofferee company shareholders, or are made by or on behalf of anofferor , its directors, officials or advisers, and not withdrawn immediately if incorrect, only in extremely exceptional circumstances will theofferor be allowed subsequently to extend itsoffer beyond the stated date except where the right to do so has been specifically reserved.Amended: October 2019No Increase Statements
TMA-2.17.5
If statements in relation to the value or type of consideration such as "the
offer will not be further increased" or "ouroffer remains at BHD X per share and it will not be raised" ("no increase statements") are included in documents sent toofferee company shareholders, or are made by or on behalf of anofferor , its directors, officials or advisers, and not withdrawn immediately if incorrect, only in extremely exceptional circumstances will theofferor be allowed subsequently to amend the terms of itsoffer in any way even if the amendment would not result in an increase of the value of theoffer (e.g. the introduction of a lower paper alternative) except where the right to do so has been specifically reserved.Amended: October 2019TMA-2.17.6
An
offeror orofferee company must not make statements about the level of support received from shareholders or other persons, unless they have clearly stated their intentions to theofferor orofferee company, or advisors, as appropriate. CBB will require statements made to be verified, which could include the shareholder confirming their support in writing to theofferor or its advisors, which will then be treated as a letter of intent/consent, as the case may be.Amended: October 2019TMA-2.17.7
Shareholders must not be pressured by any means or by any party involved in an
offer to accept or reject suchoffer through information, documents, advertisements or statements.Amended: October 2019Advertisements
TMA-2.17.8
Any advertisements published in terms of the Module must obtain the prior approval of the CBB. The publication of advertisements in relation to an
offer or potentialoffer is prohibited unless they fall within the following categories:(a) Product advertisements not having an effect on anoffer or potentialoffer , CBB must be consulted if there is any doubt;(b) Corporate image advertisements not having an effect on anoffer or potentialoffer ;(c) Advertisements in relation to non-controversial information about anoffer , such as the value of anoffer or closing dates;(d) Advertisements in relation to preliminary or interim results;(e) Advertisements comprising a tenderoffer ; or(f) [This Subparagraph was deleted in October 2019](g) Advertisements published with the specific prior consent of CBB.Amended: October 2019TMA-2.17.9
Any forms connected with an
offer , including acceptance forms, withdrawal forms, proxy cards must not be published in newspapers or any form of advertisement.Telephone Campaigns
TMA-2.17.10
Campaigns relating to contacting shareholders or persons interested in the
offer by telephone must be conducted only by theprofessional advisor and his staff, who are fully aware of the responsibilities and requirements of this Module. Information passed to such persons must be accurate, already published and not misleading. Persons contacted must not be pressured and must be encouraged to consult their advisors.Amended: October 2019TMA-2.17.11
[This Paragraph was deleted in October 2019]
Deleted: October 2019TMA-2.18 TMA-2.18 Announcement of Result of Offer
Timing and Contents
TMA-2.18.1
An
offeror must publish an announcement on the business day following the day on which theoffer will expire, or becomes or is declared unconditional (whether as to acceptances or in all respects), or is revised or extended.Amended: January 2022
Amended: October 2019TMA-2.18.2
For the purpose of Paragraph TMA-2.18.1, the
offeror must forward such announcement to the CBB and thelicensed exchange andofferee company and publish the announcement on the website of thelicensed exchange before trading hours at thelicensed exchange in Bahrain.Amended: January 2022
Amended: October 2019TMA-2.18.3
The announcement must state the number of shares and rights over shares:
(a) For which acceptances of theoffer have been received;(b) Held, controlled, or directed by theofferor or personsacting in concert with it before theoffer period ; and(c) Acquired or agreed to be acquired during theoffer period by theofferor or any personsacting in concert with it.Amended: October 2019
Amended: April 2013TMA-2.18.4
The announcement must include a prominent statement of the total numbers of shares which the
offeror may count towards the satisfaction of its acceptance condition and must specify the percentages of each class of relevant securities represented by these figures. CBB must be consulted if theofferor wishes to make any other statement about acceptance levels in any announcement made.Amended: October 2019TMA-2.18.5
The
offeror must send copies of the certificate issued by the designatedreceiving bank to the CBB, thelicensed exchange and theofferee company'sprofessional advisor as soon as possible after it is issued.Amended: October 2019TMA-2.18.6
If statements are made during an
offer by anofferor or its advisors, either orally or written, about level of acceptances of theoffer or number or percentages of shareholders who have accepted theoffer , then an immediate announcement must be made.TMA-2.18.7
Companies whose securities are not admitted to listing or trading that are a party to the
offer will normally not be required to make a public announcement, however it will be required to inform all shareholders about the result of theoffer .Amended: October 2019TMA-2.18.8
When the
offeree company has the intention to make an announcement on the level of withdrawals of acceptance of anoffer , CBB must be consulted before any announcement is made.Consequences of Failure to Announce
TMA-2.18.9
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.18.10
If the
offeror is unable to comply with any of the requirements of this Section, within the time limit granted, the CBB shall have the right to request thelicensed exchange to suspend dealings in theofferee company's shares and, where appropriate, in theofferor's shares until the relevant information and documents are provided.Amended: October 2019TMA-2.18.11
If an
offeror has been declared unconditional as to acceptance, but theofferor fails to comply with any of the requirements of this Section by the close of trading at thelicensed exchange in Bahrain on the relevant day, the CBB shall have the right to grant the acceptors the right of withdrawal from theoffer .Amended: October 2019TMA-2.18.12
This right of withdrawal may be terminated not less than 8 days after the relevant date in the case that the
offeror confirms that theoffer is still unconditional as to acceptances and complies with this Section.Amended: October 2019TMA-2.19 TMA-2.19 Settlement of Consideration and Share Transfer
Timing of Acquisition and Payment
TMA-2.19.1
Shares represented by acceptances in any
offer must not be accepted by theofferor until theoffer has become or has been declared unconditional. Such shares must be paid by theofferor in accordance with the terms of payment as stipulated in theoffer document .Amended: October 2019Withdrawn or Lapsed Offers
TMA-2.19.2
If an
offer is withdrawn or lapses, theofferor must, as soon as possible but in any event within 7 calendar days thereof, post the share certificates or transfer documents lodged with acceptance forms to, or make such share certificates or transfer documents available for collection by, thoseofferee company shareholders who accepted theoffer .Amended: October 2019TMA-2.19.3
[This Paragraph was deleted in January 2022].
Deleted: January 2022
Added: October 2019TMA-2.19.4
[This Paragraph was deleted in January 2022].
Deleted: January 2022
Added: October 2019TMA-2.19.5
[This Paragraph was deleted in January 2022].
Deleted: January 2022
Added: October 2019Payment of Consideration
TMA-2.19.6
An
offeror must complete payment of consideration whether in the form of cash, in form of securities, or a combination of cash and securities, as the case may be, to all shareholders by crediting the shareholders bank account and/or the shareholders’securities account , as the case may be, who have accepted the offer, within 10 calendar days from the last closing date of theoffer .Amended: January 2022
Added: October 2019TMA-2.19.7
[This Paragraph was deleted in January 2022].
Deleted: January 2022
Added: October 2019TMA-2.19.8
An
offeror must deposit the unclaimed balances, if any, in an escrow account with a licensed bank within 15 calendar days from the last closing date of theoffer .Added: January 2022TMA-2.19.9
An
offeror , on its own or together with personacting in concert , must not exercise thevoting rights attached to the shares received through acceptances of the take-over offer prior to full settlement of the consideration.Added: January 2022TMA-2.20 TMA-2.20 Restrictions on Dealings before and during the Offer
Restrictions on Dealings Before the Offer
TMA-2.20.1
No dealings of any kind in the securities of the
offeree company (including convertible securities, warrants, options and derivatives in respect of such securities) may be transacted by any person, not being theofferor , who is engaged in theoffer and who has confidential price-sensitive information concerning an actual or contemplatedoffer or revisedoffer between the time when there is reason to suppose that an approach or anoffer or revisedoffer is contemplated and the announcement of the approach, theoffer , the revisedoffer , or of the termination of the discussions where an announcement of theoffer has been made public.Amended: October 2019TMA-2.20.2
Such restrictions do not apply to persons
acting in concert with anofferor in respect of dealings where the securities of such dealings are excluded from theoffer or where there are no-profit arrangements in place.Amended: October 2019TMA-2.20.3
No person who is engaged in the
offer and who has access to the price-sensitive information may deal in securities of theofferor except where the proposedoffer is not price-sensitive in relation to such securities.Amended: October 2019TMA-2.20.4
No person who is engaged in the
offer and who has access to the price-sensitive information may make any recommendations to any other person as to dealing in the relevant securities.Amended: October 2019TMA-2.20.5
CBB must be consulted before acquisitions of interests in
offeree company securities are made by members or potential members of a consortium. If there are existing interests in such securities, it will be necessary to satisfy the CBB that they were acquired before the consortium was formed.Amended: October 2019TMA-2.20.6
A person is considered to have access to confidential price-sensitive information concerning an
offer or contemplatedoffer if the person:(a) Is a director or employee of one of the companies or entities concerned or engaged in theoffer or potential offer including, but not limited to, theofferor , theofferee or any person acting in concert with theofferor orofferee ;(b) An advisor, includingprofessional adviser , to one of the companies or persons concerned or engaged in the offer or potentialoffer ;(c) In a position to have received and has actually received information through a confidential relationship;(d)Connected persons and companies controlled by theofferor and those described in (a), (b) and (c); or(e) Is considered as having or had access to price sensitive information by virtue of the relevant facts and circumstances.Amended: January 2022
Amended: October 2019No-Profit Arrangement
TMA-2.20.7
Arrangements made by a potential
offeror with aperson acting in concert, where securities in theofferee company are acquired by the personacting in concert and theofferor will bear all the risks and receive all the benefits are not prohibited by TMA-2.20.1. Arrangements which have benefits or potential benefits to the person acting in concert, beyond normal expenses and carrying costs, are normally prohibited. In cases of doubt, CBB should be consulted.Amended: October 2019Restrictions on Dealings during an Offer
TMA-2.20.8
The
offeror and personsacting in concert with it must not sell any securities in theofferee company during theoffer period except with the prior consent of the CBB, after 24 hour's advance notice by public announcement of the intention to sell.Amended: October 2019TMA-2.20.9
The CBB will not provide its consent for the sale of securities by an
offeror and personsacting in concert with it where amandatory offer is being made.Amended: October 2019TMA-2.20.10
After an announcement of an intention to sell the securities of the
offeree company has been made, neither theofferor nor personsacting in concert with it can make further purchases and only in exceptional circumstances will the CBB allow theofferor to raise the offer price.Amended: October 2019TMA-2.20.11
Subject to TMA-2.20.8 in respect of the conditions applicable, the sale of any shares in the
offeree company must not be below theoffer price.Amended: October 2019TMA-2.20.12
An
offeror or other persons shall be restricted from dealing or procuring other persons to deal, if theofferor has been supplied by theofferee company with confidential price sensitive information duringoffer discussions.Amended: October 2019TMA-2.20.13
The consent of the CBB is not required for placing or underwriting arrangements made during an
offer in order to achieve the minimum public shareholding to maintain the listing of theofferee company's shares provided that such arrangements are not effective prior to the date when theoffer becomes or is declared unconditional. If anofferor wishes to make such arrangements in order to hold less than 75% (or such percentage as may be relevant in the event that thelicensed exchange has accepted that a percentage other than 20% of theofferee company's shares needs to be in public hands to maintain the listing of theofferee company's shares) of theofferee company's shares, the consent of the CBB is required.Amended: October 2019TMA-2.20.14
Directors and
professional advisers to a company who have interests in securities in that company that is party to anoffer , must not deal in such securities contrary to any advice they have given to shareholder, or which it can be reasonably assumed that they were associated, without giving a 24 hours advance public notice of their intentions with an explanation.Amended: October 2019Restriction on Dealings by Offeror during Non-Cash Offers
TMA-2.20.15
Where the consideration under an
offer includes securities of theofferor or a personacting in concert with it, neither theofferor nor any personacting in concert with it may deal in any such securities during theoffer period .Amended: October 2019Restrictions on Dealings by a Competing Offeror
TMA-2.20.16
Except with the consent of the CBB, where two competing
offers have been made and one of theoffers has lapsed, then neither thatofferor nor any personacting in concert with thatofferor may acquire any interest in shares in theofferee company at a price higher than that made available under its lapsedoffer .Amended: October 2019TMA-2.20.17
Paragraph TMA-2.20.16 shall not apply where each of the competing
offers has either been declared unconditional in all respects or has itself lapsed.Amended: October 2019TMA-2.20.18
For the purpose of Paragraph TMA-2.20.16, the price of the lapsed
offer shall be calculated as at the day theoffer lapsed.Amended: October 2019Dealings After Termination of Discussions
TMA-2.20.19
If following an announcement that
offer discussions are taking place, or that an approach oroffer is being contemplated, discussions are then terminated or theofferor then decides not to proceed with anoffer , an announcement of the position must take place before any dealings in securities of theofferee company take place by any person privy to confidential information.Amended: October 2019Dealings in Offeree Company Securities by Certain Offeree Company Associates
TMA-2.20.20
During the
offer period ,professional advisers or stockbrokers (or any person controlling, controlled by or under the same control as any such adviser or stockbroker) to anofferee company (or any of its parents, subsidiaries or fellow subsidiaries, or their associated companies or companies of which such companies are associated companies) must not, except with the consent of CBB:(a) Purchaseofferee companysecurities or deal in convertible securities, warrants, options or derivatives in respect of suchsecurities for its own account or for its discretionary clients;(b) Make any loan to a person to assist in making any such purchases; or(c) Enter into any indemnity or option arrangement or any arrangement, agreement or understanding, formal or informal, or in any other nature, which may be an inducement for a person to retain, deal or refrain from dealing in relevant securities of theofferee company.TMA-2.20.21
Paragraph TMA-2.20.20 does not apply to fund managers and principal traders that are exempt by CBB who are dealing for any of their investment accounts managed on a discretionary basis.
Amended: October 2019Gathering Irrevocable Commitments
TMA-2.20.22
Any person proposing to contact a private individual or a corporate shareholder with the aim of obtaining an irrevocable commitment should consult CBB in advance.
Amended: October 2019TMA-2.21 TMA-2.21 Disclosure of Dealings During Offer Period
Dealings by Parties and by Associates for Themselves or for Discretionary Clients
TMA-2.21.1
Dealings in relevant securities by an
offeror or theofferee company, and by any associates, for their own account or for the account of discretionary investment clients account during anoffer period must be publicly disclosed.Amended: October 2019TMA-2.21.2
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.21.3
Except with the consent of the CBB, dealings in relevant securities during an offer period for the account of discretionary investment clients by an associate which is an
exempt fund manager connected with an offeror or the offeree company must be privately disclosed. If, however, theExempt fund manager is anassociate by virtue of sub-paragraph (f) of the definition ofassociate , theexempt fund manager must disclose publicly, in addition to disclosing privately.Amended: October 2019Dealings by Parties and by Associates for Non-Discretionary Clients
TMA-2.21.4
Except with the consent of the CBB, dealings in relevant securities during an offer period by an
offeror or theofferee company, and by any associates, for the account of non-discretionary investment clients (other than anofferor , theofferee company and anyassociates ) must be privately disclosed.Amended: October 2019Discretionary Accounts
TMA-2.21.5
If a person manages investment accounts on a discretionary basis, relevant securities so managed will be treated, for the purpose of this rule, as controlled by that person and not by the person on whose behalf the relevant securities are managed. Except with the consent of the CBB, where more than one discretionary investment management operation is conducted in the same group, relevant securities controlled by all such operations will be treated for the purpose of this rule as those of a single person and must be aggregated.
Amended: October 2019Connected Exempt Principal Traders
TMA-2.21.6
Dealings in relevant securities by an
exempt principal trader connected with anofferor or theofferee company must be aggregated and disclosed to thelicensed exchange before trading hours at thelicensed exchange in Bahrain on the business day following the date of the transactions.In the case of dealings in options or derivatives, full details must be given so that the nature of the dealings can be fully understood.
Amended: October 2019TMA-2.21.7
For the purposes of this Section, the disclosure shall consider the following:
(a) Disclosure shall be made before trading hours at thelicensed exchange in Bahrain on the business day following the date of the transaction. CBB should be consulted on any practical difficulties;(b) In the case of a public disclosure, dealings should be disclosed in writing to allofferor s and theofferee company or their respectiveprofessional advisers while also disclosing to the CBB and also, in respect of dealings in listed securities, to thelicensed exchange ; and(c) The disclosure shall include the following:(i) The total number of securities purchased or sold;(ii) Prices paid or received. In the case of an average price bargain each underlying trade should be disclosed;(iii) Identity of the associate or any other person dealing if different from the owner or controller;(iv) If dealing with an associate, an explanation of how that status arises;(v) If disclosure is made by a 5 percent shareholder or group of shareholders, a statement to that effect;(vi) The resultant total number of relevant securities owner or controlled by the associate and percentage which it represents; and(vii) If relevant, details of any arrangements required in the context of indemnity and other arrangements.Amended: October 2019
Amended: April 2013TMA-2.22 TMA-2.22 When Cash Offer is Required
TMA-2.22.1
Except with the CBB's consent, a cash
offer is required where:-(a) Theofferor and any personacting in concert with it has bought for cash during theoffer period and within 6 months prior to its commencement, an interest in shares of any class underoffer in theofferee company carrying 10% or more of the voting rights of that class; or(b) In the view of the CBB there are circumstances which render such a course necessary.The
offer for each class of shares must be in cash or accompanied by a cash alternative at not less than the highest price paid by theofferor or any personacting in concert with it for shares of the class during theoffer period and within 6 months prior to the commencement.Amended: October 2019
Amended: April 2013TMA-2.23 TMA-2.23 Purchases at Above Offer Price
Highest Price Paid
TMA-2.23.1
[This Paragraph was deleted in October 2019].
Deleted: October 2019TMA-2.23.2
[This Paragraph was moved to Paragraph TMA-2.23.5A in October 2019].
Amended: October 2019Acquisitions Before Announcement of a Firm Intention to Make an Offer
TMA-2.23.3
The
offer to the holders of shares of the same class shall not be on less favourable terms, when anofferor or any personacting in concert with it has acquired an interest in shares in theofferee company:(a) Within the three month period prior to the commencement of theoffer period ; or(b) During the period, if any, between an announcement made by theofferor and the commencement of theoffer period .Amended: October 2019Acquisitions After Announcement of a Firm Intention to Make an Offer
TMA-2.23.4
After an announcement of a firm's intention to make an
offer and before theoffer closes for acceptance, anofferor or any personacting in concert with it acquires any interest in shares at above theoffer price, it shall increase itsoffer to not less than the highest price paid for the interest in shares acquired in such circumstances.Amended: October 2019TMA-2.23.5
Immediately after the acquisition of shares at above the
offer price, theofferor must announce that a revisedoffer will be made in accordance with this Section. This announcement must state the number of shares concerned and the price paid.Amended: October 2019TMA-2.23.5A
Subscription for new securities at a price above the
offer price will be treated as a purchase for the purposes of Paragraph TMA-2.23.4.Added: October 2019Offers Involving a Further Issue of Listed Securities
TMA-2.23.6
If the
offer involves a further issue of securities of a class already listed on alicensed exchange , the current value of theoffer on a given day should normally be established by reference to the weighted average traded price of board lots (excluding special bargains and odd lots) of such securities traded during the immediately preceding trading day. If theoffer involves a combination of cash and securities and further purchases of theofferee company's shares oblige theofferor to increase the value of theoffer , theofferor must endeavour, as far as practicable, to effect such increase while maintaining the same ratio of cash to securities as is represented by theoffer .Amended: October 2019TMA-2.24 TMA-2.24 Provision for Escrow
[This Section was moved to Section TMA-2.19 in October 2019]
TMA-2.24.1
[This Section was moved to Section TMA-2.19 in October 2019]
Amended: October 2019TMA-2.24.2
[This Section was moved to Section TMA-2.19 in October 2019]
Amended: October 2019TMA-2.24.3
[This Section was moved to Section TMA-2.19 in October 2019]
Amended: October 2019TMA-2.25 TMA-2.25 No Special Deals or Arrangements with Selected Shareholders
TMA-2.25.1
Except with the CBB's consent, the
offeror or personsacting in concert with it may not make any arrangements with selected shareholders; and may not deal or enter into arrangements to deal; or make purchases or sales of shares of theofferee company; or enter into arrangements concerning acceptance of anoffer either during anoffer or when one is reasonably in contemplation, if there are favourable conditions attached which are not being extended to all shareholders.Amended: October 2019TMA-2.25.2
An arrangement with special conditions attached includes any arrangement where there is a promise to make good to a vendor of shares any difference between the sale price and the price of any subsequent successful
offer , revisedoffer or successful competingoffer . An irrevocable commitment to accept anoffer combined with an option to put the shares to theofferor should theoffer fail will also be regarded as such an arrangement.Amended: October 2019TMA-2.25.3
Two-tier
offers where shareholders who accept theoffer before a stipulated cutoff date would receive a higher consideration than those who accept theoffer after the cut-off date will be regarded as arrangements with special conditions. A two-tieroffer thatoffers to pay a higheroffer price if a certain level of acceptances is reached will not be regarded as an arrangement with special conditions if the higheroffer price is payable to all accepting shareholders.Amended: October 2019TMA-2.25.4
Paragraph TMA-2.25.1 also covers cases where a shareholder in an
offeree company is to be remunerated for playing a part in promoting anoffer . The CBB will normally consent to such remuneration, provided that the shareholding is not substantial and it can be demonstrated that a person who had performed the same services, but had not at the same time been a shareholder, would be entitled to receive no less remuneration.Amended: October 2019TMA-2.25.5
The CBB should be consulted if the management of the
offeree company is to remain financially interested in the business after theoffer is completed. The methods by which this may be achieved vary but the principle which the CBB is concerned to safeguard is that the risks as well as the rewards associated with an equity shareholding should apply to the management's retained interest.Amended: October 2019TMA-2.26 TMA-2.26 Proxies
TMA-2.26.1
A shareholder must not appoint a person as his proxy to vote in respect of his shares in the
offeree company; or to exercise any other rights; or to take any other action in relation to those shares unless the appointment is under the following conditions:(a) Theoffer is unconditional in all respects;(b) The votes are to be cast as far as possible to satisfy any outstanding condition to the offer, where relevant;(c) The appointment ceases to be valid if the acceptance is withdrawn; and(d) The appointment only applies to shares assented to the offer.Added: October 2019TMA-2.26.2
The terms for the appointment of a proxy must be set out in the
offer document .Added: October 2019