If the issuer is listed on the Main Market, shareholder approval will be required for any issuances at a price representing more than a 10% discount. The Pre-Emption Group Guidelines recommend further restricting this to 5% if the shares are issued on a non-pre-emptive basis.
Takeover Code
Under the UK Takeover Code, 30% is the threshold for a mandatory offer. If an investor and its concert parties would cross that threshold, the investor and issuer may need to seek the Takeover Panel’s consent to the issuance and obtain a waiver of the obligation to make a mandatory offer (a ‘Code whitewash’).
Controlling Shareholder
If a Code whitewash (above) is granted, the UK Listing Rules set out a controlling shareholder (broadly a shareholder with 30% or more of the voting rights) regime which will need to be adhered to. However, following changes to the UK Listing Rules last year, written relationship agreements between an issuer and a controlling shareholder are no longer required.
Lock Up and Standstill
Investors often required to agree to a lock-up and standstill terms for a period of time, typically around six to 12 months depending on the size of the investment.
Information
If an investor receives material non-public information (e.g., via diligence or board/observer rights), trading in issuer shares is restricted until information is cleansed.
Fund Constitutional Restrictions
Significant minority investments in listed companies outside of a public to private strategy are not always permitted by a fund’s investment mandate, which will need to be reviewed for any restrictions.
Significant or Related Party Transactions
If the investor is an existing shareholder in the issuer, whether the PIPE transaction would classify as a significant or related party transaction under the UK Listing Rules, and any related disclosure requirements, should be considered.
/Passle/65290529ef3e020b322657f8/SearchServiceImages/2024-12-19-18-00-54-008-67645f563e67bad811f7603c.jpg)
/Passle/65290529ef3e020b322657f8/SearchServiceImages/2024-10-28-11-05-03-011-671f6fdf9a1e295c5efbe5d8.jpg)
/Passle/65290529ef3e020b322657f8/SearchServiceImages/2024-10-28-11-06-21-026-671f702d7060a454687b9add.jpg)