CODEWORD

On 1 July 2021, the Panel marked 20 years of the Takeovers Code.

Established under the Takeovers Act 1993, the Panel was first tasked with drafting and recommending the Code. Among other objectives, the Code was aimed at encouraging competition for the control of companies, ensuring shareholders are treated fairly in a takeover, and promoting international competitiveness of New Zealand’s capital markets.

Until the Code came into force, New Zealand’s capital markets had been described as the ‘wild west’. There were takeovers that allowed controlling shareholders, and often their associates, to sell their shares at a premium to the price received by other shareholders.

When the Code came into force in 2001, New Zealand’s takeovers rules were brought into line with countries sharing a similar common law structure, including Australia, Hong Kong, Singapore and the United Kingdom.

The Code has evolved along with the development of capital markets over the last 20 years, but the core rules of the Code have stood the test of time. These rules ensure that investors in publicly listed and other widely held companies are provided with the adequate information and time to allow them to make informed decisions about a change in the control of those companies.

The Panel acknowledges and thanks all those who have contributed their time and professional expertise to serve as Panel members. These include John King, the Panel’s first Chair, David Jones, the Panel’s second Chair, and the other foundational Panel members who were responsible for drafting the original Code.