Takeovers

How will I be notified of a Corporate Action?

If you hold stock in a company that is undertaking an Offer you can expect to receive an email notification shortly after we have received the official documents. We would usually expect to send out this notification shortly after and with a usual acceptance period of around 2 weeks dependent upon the pre determined official dates. This email will be self-explanatory and will contain all your acceptance & decline options and be sent to your registered email address.

What happens if I wish to accept the offer?

If you accept the offer for Company X you can expect your holdings of Company X to be removed from your account position and replaced by the 'Assented' line of stock on a 1 for 1 basis.

What happens if I Decline the offer?

If you do not wish to accept an offer you may either do nothing or decline the offer. However, if you 'Decline' an offer after it has been declared 'Wholly Unconditional' and this has been notified to you in a 429 notice email or similar then your shares will be rematerialsed in to certificate form and re registered to your name and address. A minimum charge of £10 will be levied to accounts for an election to Decline.

What is an 'Assented Line' of Stock?

This is the market instrument credited to shareholders who have accepted / assented to an offer. This instrument is un-tradable and will not have any indicative price or value but will remain in your account until the relevant Takeover / Offer proceeds have been received.

What if the offer is extended?

If the company makes an announcement that the offer has been extended and remains open for acceptances this does not in anyway directly affect the acceptance procedure carried out by iDealing. Clients who are still able to accept the Offer will be notified via e-mail regarding the next acceptance period they will be offered.

Can I just accept the offer when I feel like it?

We do not accept ad hoc acceptances individually. Therefore if you have not accepted an offer by the initial deadline indicated to you in the original email, you will have to wait for the next acceptance period that is offered to you by iDealing. Again, this deadline is not related to extension announcements made by any other party, related to the offer or not.

What does 'Wholly Unconditional' mean?

Once an offer has received the required percentage of acceptances the offer can be declared 'Wholly Unconditional', therefore meaning that the offer has been successful and will not now fail or lapse.

What is a 429 Notice?

This is a legal document issued by the Offerer In accordance with the Companies Act 1985, which enables the offerer to 'Mop Up' shares from non-assenting shareholders who make no election regarding their shares.

What do I do if I want to change my election from Decline to Accept?

If you declined or did not wish to accept the takeover offer when you were first notified you will be sent a further email either on receipt of a 429 notice or if the stock is to be de-listed. You will then be given a further period in which to accept the offer. Until such time that this further notice is given we will not carry out individual acceptances upon the receipt of an email or any other correspondence.

What do I do if I want to change my election from Accept to Decline?

If you have carried out an online acceptance of an offer, you will only be able to amend your instructions up until the Deadline Date. Once this date has passed you will not be able to change any instructions as your holding will have been removed from your account position and delivered to the Market.

When will I receive cash?

You can expect to receive the takeover proceeds up to 14 days after the offer is declared wholly unconditional. If you have accepted the offer upon receipt of a 429 Notice email then you can therefore expect to receive the proceeds up to 14 days after the expiry of the 429 Notice, which would usually be 6 weeks after issue.

What happens if I do nothing?

If you do not wish to either accept or decline the offer and offer no such instructions online or to the Corporate Action email sent to you then on the final date quoted in the email sent to you stating 'Default to Accept' then we will carry out an acceptance of the offer on your behalf. You will then receive the takeover proceeds in due course.

Why have you 'sold' my holding?

If your holding in a stock has been removed and you have received cash but you were unaware of any action we have taken, it would suggest that you did not reply to a Corporate Action email and the default option of acceptance on your behalf has been carried out. This may happen if you have not updated your e-mail address on your iDealing account (login and click on the 'Contact Details' option on the menu). If you experience problems amending your details online please email admin@idealing.com

Why have I received a certificate?

If you have received a Certificate for the stock under offer it will be because you requested us to Decline the offer. Your account will have been debited a charge notified to you in the email also.

Why can I not see any Offer details for my holding in Company X on the Corporate Actions Link?

All Corporate Actions that appear on the 'Corporate Actions' link will remain visible up until the 'Deadline Date'. After this date the offer will not be acceptable either online or by email. If you wish to accept an offer but cannot see the offer online any longer we WILL NOT then accept an email as acceptance of this offer. You can expect to be notified by email again in the near future if and when iDealing offer a further acceptance period.

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Open Offer / Rights Issue / Entitlement Offers

When will I be notified of an Open Offer / Rights Issue / Entitlement Offer?

All notifications of offers such as these will be sent out to qualifying clients. 1st registered email address on or shortly after the 'Ex Date'.

What is an Ex date?

The 'Ex Date' is the 'cut off' date for entitlement to take up the offer i.e. To be entitled to take up an offer by Company X you must be a holder of the relevant stock of Company X the day prior to the ex date.

Example: Vodafone has a Rights Issue of 2 new Ords for every 1 held at 100p per share

Ex date = 7th June 2004
Record date = This date is irrelevant to clients.
Client A Holding as at 6th June 2004 = 10,000 Ordinary Shares
Client A Purchase on 7th June 2004 = 5,000 Ordinary Shares
Client A's entitlement to take up the Rights Issue is based solely on the holding of 10,000 shares prior to the ex date and is therefore; 20,000 New Shares at 100p per new share. (10,000 x 2 = 20,000) x 100p = £20,000

What is the Record date?

This date is for the purposes of issuing entitlements by the Registrars and should not be confused with the Ex Date, which is the only date that will affect clients' Entitlements to take up any Offer.

What is a Nil Paid share?

Nil paid shares are a separate security with an associated Entitlement that may be credited to qualifying shareholders in relation to some but not all Rights Issues. These can be a tradable security like any other but have a limited lifespan and any sale of Nil Paid shares received as entitlement to take up an offer will surrender their associated entitlement to the offer. Any details of tradable Nil paid shares will be indicated in the original notification email.

Can I buy or sell Nil Paid shares?

Nil paid shares that are tradable can be both bought and sold with the associated entitlement remaining with the Nil Paid shares. i.e. If you receive Nil Paid shares from the ownership of a security and you then sell these shares you are no longer entitled to take up the Rights, but if you did not hold the relevant Ordinary shares at the ex date and therefore did not qualify to receive the Nil Paid shares you can purchase Nil Paid shares in the market which will then qualify you to take up the associated rights. Any purchaser of Nil Paid shares wishing to take up their rights is required to notify the Corporate Actions dept of both the purchase and of their wishes to take up the entitlement associated to this purchase on the same day of the trade.

Can I sell my holding and still take up the Rights?

Once your entitlement has been established on the ex date you are able to sell the associated Ordinary line of stock and this will not then affect your entitlement.

How do I pay to take up an offer?

All payment options and details will be sent to clients in the original notification email. Entitlements to Fully subscribed ISA's can be taken up in Standard Accounts with payment then taken from the Standard a/c. If clients do not hold an account of this type they will be required to open one and fund this account prior to any take up being carried out. Funds may be liquidated from within fully subscribed accounts by way of a sale of other securities within the same account / portfolio in order to take up an entitlement.

When will the cash be debited from my account?

The 'Deadline Date' as indicated both in the original email sent to you and on the Corporate Action link for the offer is the date when the offer will be processed and cash debited. If insufficient funds are available in the account then we may reduce the amount of take up to coincide with your remaining cash balance.

When will I receive my new shares?

The original email sent to you will indicate the date that Crest accounts are to be credited. You can then expect this credit to be reflected in your account by the close of business the same date. No new stock will be credited to any accounts until receipt is verified in our Nominee Crest accounts. The payment for new shares and the credit of stock is not carried out on the same day.

What happens if I do nothing?

If you do not wish to take up the offer and do not sell any holding of Nil Paid shares that may be credited to your account then you may be entitled to 'Lapsed Rights Proceeds'.

What are Lapsed Rights Proceeds?

All Rights Issues will be underwritten by a 3rd party who, in the case that shareholders do not take up their total entitlements, will take up (underwrite) the remaining Rights on behalf of the company and then carry out a sale of all new Ordinary shares received, in the Market. Any premium (positive difference) over the sale price of the Ordinary shares and the take up price will then be distributed to those shareholders who did not either sell or take up their rights. If no premium was attained during the sale of New Ordinary shares sold by the Underwriters, no Lapsed Rights Proceeds will be distributed and Nil Paid shares will be removed from client's accounts with no associated value.

When will I receive my prospectus?

No official literature such as prospectus., application letters, allotment letters etc. will be sent out to any clients relating to a corporate event on a stock held within a portfolio unless otherwise notified. All email notifications will contain a link to a news article relevant to either the specific Corporate Action, the individual corporate event or both.

How can I take up the offer if I've fully subscribed to my current ISA?

Should the stock be due to a fully subscribed ISA account, to accept the offer, the funds required to cover the cost would need to be raised by way of a sale. If the stock is due to an ISA account with sufficient subscription headroom, you may take up the offer, but the additional funds deposited to cover the cost would be added to your subscription limit. Alternatively, if you do not wish the cost of the additional shares to be added to your ISA account, you may choose one of the following options; a) Take up the stock in a Standard Account (should you NOT have a Standard Account, you would need to login to our website and click Open an Account) or b) Hold Stock physically (certified) in your own name & that there will be a charge of *GBP10 if you chose to have the shares registered in your own name. Please note these are the only options open to you.

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Online: Corporate Actions

If you receive an email indicating that a holding in your portfolio is subject to a Corporate Action that requires you to input an instruction, login to your account and click on the 'Corporate Actions' link on the home page to view details of the event.

How do I Accept a Takeover online?

If the event type is a 'Takeover' and you wish to ACCEPT the offer as detailed under the info tab, you are required to enter into the Current Acceptance box the total amount of your holding of the relevant stock. This amount will be indicated in the adjacent field 'Max Acceptance'. Any input to this page must be carried out prior to the Deadline Date for the instructions to be carried out. Once the Deadline date has passed the action will no longer appear on the Corporate Actions Link.

How do I Take up a Rights Issue or Open Offer online?

If the event type is a 'Rights Issue or Open Offer' and you wish to TAKE UP the offer as detailed under the info tab, you are required to enter into the Current Take up box the total amount of NEW shares that you wish to Take up. The limit of your entitlement will be indicated in the adjacent field 'Max Take up'. *** Do not enter any other amount than that of the amount of NEW shares you wish to purchase in the offer *** Once your required amount has been entered please click on the 'Update Instructions' button. If you then wish to review or amend your input instructions you may do so from the same link on the home page up until the Deadline Date.

How do I Tender my shares for a Tender Offer online?

If the event type is a 'Tender' and you wish to Tender some or all or your shares to the offer as detailed under the info tab, you are required to enter into the Current Tender box the amount of your holding that you wish to Tender. The Maximum Tender amount will be indicated in the adjacent field 'Max Tender'. Once your required amount has been entered please click on the 'Update Instructions' button. If you then wish to review or amend your input instructions you may do so from the same link on the home page up until the Deadline Date.

How do I Redeem my Redeemable shares for a Redemption Offer online?

If the event type is 'Redemption' and you wish to Redeem some or all or your shares to the offer as detailed under the info tab, you are required to enter into the Current Redeem box the amount of your holding that you wish to Redeem. The Maximum Redeem amount will be indicated in the adjacent field 'Max Redeem'. Once your required amount has been entered please click on the 'Update Instructions' button. If you then wish to review or amend your input instructions you may do so from the same link on the home page up until the Deadline Date.

How do I Decline a Corporate Action?

If you do not wish to offer any instructions to either ACCEPT, TAKE UP, TENDER, REDEEM please DO NOT enter any amount into the box and DO NOT hit the 'Update Instructions' button. If you are offered the opportunity to DECLINE a Takeover offer you will be asked in the email sent to you regarding the event to reply to the email sent confirming your instructions to DECLINE the offer. We cannot and will not accept a decline instruction other than by email and by reply to the original.

What is the Deadline date?

The Deadline date indicated for online Corporate Actions is effective as of 00:00 Midnight. Therefore if the deadline date is indicated as before 15th May 2003 your last opportunity to enter instructions will be 23:59 14th May 2003.

What happens if I miss the Deadline Date?

If the Deadline date has passed when you attempt to access the Corporate Actions Link you will not see any relevant Corporate Action that relates to the email initially sent to you. This does not mean you cannot now accept the offer it just means that we will not accept your acceptance of the offer at this time. If and or when the offer is declared "Wholly Unconditional" (ie. The offer has reached a certain level of acceptances and the offer will now be completed and not lapse) you can expect to be given a further opportunity to accept the offer with notification of this new acceptance period given in a 429 Notice or similar email.