25/07/2011
BAPEPAM-LK REGULATION REGARDING VOLUNTARY TENDER OFFERS
On the day that it issued its new rule on public company takeovers (Rule IX.H.1, which is also in this July newsletter), the Capital Market and Financial Institution Supervisory Agency (Bapepam-LK) also issued Rule IX.F.1 regarding Voluntary Takeovers (“Rule IX.F.1”). The subject matters of both Rule IX.F.1 and Rule IX.H.1 were formerly regulated in one Bapepam-LK rule, i.e. the previous Rule No.IX.F.1 concerning Tender Offers. The latter ceased to be valid on the date of the issue of the two new rules.
Item 1 (a) (3) of Rule IX.F.1 defines the term “Voluntary Tender Offer” as “voluntary offer by a certain party to obtain equity securities by way of purchasing them or exchanging them with other securities through the mass media”. As in the case of public offerings, the voluntary offeror is required to file a statement of tender offer before proceeding with the tender offer.
Section 2 of this rule contains detailed stipulations on the registration statement. The registration statement must among others state the relationship between the offeror and the target company, the objective of the tender offer, the securities in hand and the identities of parties that support the tender offer. The information contained in the statement of tender offer must be published in at least two Indonesian daily newspapers, one of which must be circulated on a national level. After the publication of the tender offer, the offer cannot be annulled unless approved by Bapepam-LK.
Rule IX.F.1 also allows other parties to support the tender offer by encouraging the holders of the securities to accept the offer, or to oppose the tender offer by advising the holders of the securities to ignore the offer.
The voluntary tender offer must commence two days after the statement of offer becomes effective. The offer lasts for 30 days, but the offering time could be extended to 90 days at the most with the approval of Bapepam-LK.
Rule No.IX.F.1 has been in force since the date of its issue of 31 May 2011. (by: Hamud M. Balfas).