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The Panel Announces Exemption Relief To Address COVID-19 Impact

26 March 2020 - The Takeovers Panel today approved the granting of a suite of temporary class exemptions from the Takeovers Code (the Code) that are aimed at assisting Code companies in raising capital. The focus of the relief is on making it quicker and easier for shareholders to provide additional capital to Code companies.

These temporary class exemptions will apply to capital raisings conducted on or before 31 October 2020. This mirrors the timing of the NZX class waiver in relation to equity capital raising requirements. The Panel encourages Code companies to consider these exemptions in their transaction planning even though the exemption notice is currently being finalised.

Takeovers Panel Chief Executive, Andrew Hudson, said, “The Takeovers Panel acknowledges the unprecedented impacts arising from the COVID-19 virus, and the challenges being experienced by Code companies, including capital constraints. In these circumstances, the Panel has today approved the granting of temporary class exemptions designed to make it easier for Code companies to access sufficient equity capital urgently should the need arise.”

New temporary class exemptions will allow shareholders to make ‘creeping’ increases as a result of allotments (including between the 20% to 50% control zone) provided that the increase is subject to a 10% cap. In addition, shareholders will be allowed to underwrite pro-rata rights issues provided that any additional voting rights acquired above the 10% cap are not exercised and are sold within a 24-month period, or the increase is subsequently approved by shareholders. Amendments to current class exemptions will extend sell-down periods for shareholders and professional underwriters to 24 months.

The exemption notice is in the process of being prepared. The Panel will advise market practitioners on when the exemption is likely to come into effect.
Further details will be provided on the Panel's website shortly.

About the Takeovers Panel

The Panel is an independent Crown entity established under the Takeovers Act 1993. The Panel's mandate is to strengthen investor confidence in New Zealand's capital markets by enforcing the Takeovers Code. The Code ensures that all shareholders have a fair opportunity to participate in control-change transactions (such as mergers, acquisitions, takeovers and allotments) in Code companies. For further information on the Panel, please visit

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