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Recommended bid
Practical Law UK Glossary 0-107-7116 (Approx. 3 pages)
Glossary
Recommended bid
A takeover bid where the target company's directors recommend that target shareholders accept the bidder's offer or vote in favour of the scheme of arrangement, if the takeover offer is structured as a scheme of arrangement.
Rule 25.2 of the Takeover Code requires the target board to set out in its circular to all target shareholders, its opinion on the bidder's offer and the board's reasons for forming its opinion. The target board is also required to:
- Obtain competent independent advice as to whether the financial terms of the offer (including any alternative offer) are fair and reasonable and to include the substance of that advice in the target board circular.
- Include in the target board circular a recommendation from the board as to the action that shareholders should take in respect of the offer (including any alternative offer).
For further information, see Practice note, Recommended offers: the target's perspective.