Part 28

Takeovers etc
Chapter 3

“Squeeze-out” and “Sell-out”

“Sell-out”

Effect of requirement under section 983
985
1
Subject to section 986, this section applies where a shareholder exercises his rights under section 983 in respect of any shares held by him.
2
The offeror is entitled and bound to acquire those shares on the terms of the offer or on such other terms as may be agreed.
3
Where the terms of an offer are such as to give the shareholder a choice of consideration—
a
the shareholder may indicate his choice when requiring the offeror to acquire the shares, and
b
the notice given to the shareholder under section 984(3)—
i
must give particulars of the choice and of the rights conferred by this subsection, and
ii
may state which consideration specified in the offer will apply if he does not indicate a choice.
The reference in subsection (2) to the terms of the offer is to be read accordingly.
4
Subsection (3) applies whether or not any time-limit or other conditions applicable to the choice under the terms of the offer can still be complied with.
5
If the consideration offered to or (as the case may be) chosen by the shareholder—
a
is not cash and the offeror is no longer able to provide it, or
b
was to have been provided by a third party who is no longer bound or able to provide it,
the consideration is to be taken to consist of an amount of cash, payable by the offeror, which at the date when the shareholder requires the offeror to acquire the shares is equivalent to the consideration offered or (as the case may be) chosen.
Pt. 28 Ch. 3 applied (6.4.2007) by The Companies Acts (Unregistered Companies) Regulations 2007 (S.I. 2007/318), reg. 3, Sch. (with reg. 6)
Ss. 974-991 applied (with modifications) (1.10.2009) by The Unregistered Companies Regulations 2009 (S.I. 2009/2436), regs. 3-5, Sch. 1 para. 14(2) (with transitional provisions and savings in regs. 7, 9, Sch. 2)
Pts. 1-39 (except for Pt. 7 and ss. 662-669), 45-47 extended (12.5.2011) by The Companies Act 2006 (Consequential Amendments and Transitional Provisions) Order 2011 (S.I. 2011/1265), art. 5(1), Sch. 1 para. 2
Pts. 1-39 modified (31.12.2020) by Regulation (EC) No. 2157/2001, Art. AAA1(3) (as inserted by The European Public Limited-Liability Company (Amendment etc.) (EU Exit) Regulations 2018 (S.I. 2018/1298), regs. 1, 97 (with regs. 140-145) (as amended by S.I. 2020/523, regs. 1(2), 5(a)-(f)); 2020 c. 1, Sch. 5 para. 1(1))
Pt. 28 modified (31.12.2023) by The Resolution of Central Counterparties (Modified Application of Corporate Law and Consequential Amendments) Regulations 2023 (S.I. 2023/1313), regs. 1(2), 3
Pt. 28 modified (10.1.2015) by The Bank Recovery and Resolution (No. 2) Order 2014 (S.I. 2014/3348), arts. 1(2), 219(2)