ADVOKS GLOBAL · KENYA
The Capital Markets (Public Offers, Listings and Disclosures) Regulations, 2023
48. Business combination to result in identifiable core business
Edition: 2023-12-15 · In force
48. Business combination to result in identifiable core business
(1)The business combination shall result in the issuer having an identifiable core business of which it has a majority ownership or management control.(2)The Authority may consider a business combination involving an acquisition of a minority stake in the business or asset, where the issuer can demonstrate that it has management control of such business or asset.(3)The business combination must be respectively approved by a majority of independent directors, and an ordinary resolution passed by independent shareholders at a general meeting to be convened.(4)For the purpose of voting on the business combination under subregulation (3), the founding shareholders, management team, and their associates, shall not considered to be independent of each other.(5)The shareholders’ circular in relation to the business combination must contain an opinion from an independent financial adviser stating that the terms of the transaction are on normal commercial terms and are not prejudicial to the interest of the issuer and its minority shareholders.(6)Each independent shareholder (other than the founding shareholders, the management team, and their respective associates and independent shareholders who vote for the business combination) voting against the business combination shall be entitled to redeem their ordinary shares, on a pro rata basis, of the amount in the escrow account at the time of the business combination vote, provided that the business combination is approved and completed within the permitted time frame.(7)The redemption amounts with respect to the shares to be redeemed pursuant to subregulation (6) shall be paid to the electing independent shareholder as soon as practicable upon completion of the business combination, and shares tendered in exchange for cash shall be cancelled.(8)Any convertible securities attached to redeemed shares shall cease and become null and void.