Singapore is tightening takeover rules to prevent deal protection measures from discouraging competing bids.
The revised framework caps total break fees at 1% of a target company’s value and allows the Securities Industry Council to act when exclusivity arrangements deter rival offers.
The Monetary Authority of Singapore issued the revised Singapore Code on Take-overs and Mergers on the council’s advice. The changes take effect on 16 July 2026.
Target company boards and financial advisers must explain why proposed break fees are in shareholders’ interests and disclose the arrangements in offer documents.
Clearer Timelines for Takeovers and Mergers in Singapore
Shareholder meetings for schemes of arrangement must generally be held within six months of their announcement.
Approved schemes must then proceed without unnecessary delay.
A bidder that says it will not increase or extend an offer cannot later reverse that position for a specified period.
Indicative prices disclosed before a firm offer will become the price floor for the bid.
The council may also give potential offerors 28 days to make a firm offer or walk away.
Tighter Oversight of Asset Sales and Defensive Actions
Target companies seeking approval for actions that could frustrate an offer must obtain and disclose independent advice on whether the financial terms are fair and reasonable.
Companies must also disclose the expected cash return and timing when a sale of all or materially all assets competes with an offer for their shares.
The amount will be treated as a profit forecast.
The amendments follow a public consultation launched in May 2025.
Parties involved in ongoing or planned transactions have been advised to consult the council before the rules take effect.
Featured image: Edited by Fintech News Singapore, based on image by MAS
