In brief
The Takeover Panel has published a consultation paper (PCP 2026/1) proposing a series of miscellaneous amendments to the Code. This alert provides a brief summary of the key proposed changes, which are generally minor and technical in nature. The deadline for responses is Friday, 2 October 2026.
Comment
The proposed Code changes represent "housekeeping" by the Panel and are intended to codify existing Panel practice, improve clarity and align the Code with recent legislative and market developments. Although the changes are generally minor and technical, advisers should note in particular: 1) the expanded definition of "reverse takeover" which would apply to restrictions following a 2.8 statement or a lapsed offer; and 2) the Panel's emphasis on the wording of fairness opinions under Rule 16 needing to include the specific reference to "so far as shareholders are concerned". Assuming that the Code is amended as proposed, although the amendments reflect existing Panel practice, these could otherwise be traps for the unwary.
In depth
The key proposals in PCP 2026/1 can be summarised as follows:
Note 5 on the definition of "acting in concert"
- The Panel proposes to amend Note 5 on the definition of "acting in concert" to clarify that "standstill" agreements restricting a shareholder from reducing its shareholding (but not other types of standstill agreement) would give rise to the presumption of concertedness, unless the specified exceptions (regarding accepting or agreeing to accept an offer) are included.
- The proposed amendments would also extend the presumption to agreements requiring a shareholder to vote with the board's recommendation on any resolution relating to the appointment or removal of directors, again absent the specified exemptions being included.
Reverse takeover definition
- It is proposed that the definition of "reverse takeover" be broadened so that it is not limited to acquisitions of other Code companies, but would apply more generally where a Code company enters into a transaction involving the issue of more than 100% of its voting equity share capital as consideration.
- In relation to the restrictions in Rule 2.8 and Rule 35, this reflects existing Panel practice. In relation to the other references in the Code to reverse takeovers (e.g., in Rule 3), the Code wording refers to "an offer" which is a reverse takeover, so would in any event apply only to reverse takeovers involving acquisitions of other Code companies.
Rule 21.3 - Information sharing with competing bidders
- It is proposed that Rule 21.3 be amended so that Note 4 (regarding the sale of substantially all of the target's assets) be extended also to cover reverse takeovers.
- This would mean that information passed to a counterparty to a reverse takeover (noting the proposed expanded definition) after an offer situation arises would need to be provided on request to potential bidders.
"UK MTF" definition
- It is proposed that the existing "UK MTF" definition be replaced with a definition of "UK primary MTF", aligned with the terminology used in the Public Offers and Admissions to Trading Regulations 2024. Associated Code references would also be updated.
Rule 2.6(c) - PUSU deadline extensions and announcements
- It is proposed that Rule 2.6(c) be amended to remove the language regarding the particular factors considered by the Panel in granting an extension to a put up or shut up deadline. The target board would similarly no longer be required to comment on those factors.
- This change is intended to reflect both existing Panel practice and market practice, given the reality that if the target board considers an extension should be granted, it is assumed that it is because they believe that an extension is in the best interests of shareholders.
Notes on Rule 9.1
- It is proposed that a number of notes on Rule 9.1 be shortened, clarified or deleted. These changes are intended to improve accessibility and clarity rather than alter the underlying substance.
- It is worth noting that some of the guidance in Note 2 (regarding collective shareholder action) is proposed to be moved into Practice Statement 26, though there is not intended to be any change to Panel practice in this area.
- It is also worth noting that the proposed amendments to Note 10 would codify the Panel's existing practice that, in certain circumstances, it will allow a Rule 9 waiver to be sought upon exercise of convertible securities, options or warrants, notwithstanding that a Rule 9 waiver was not (or could not be) sought at the time of issue.
Rule 16 fairness opinion
- It is proposed that Rule 16 be amended so that any independent adviser opinion on a special deal or management incentivisation arrangement must state that the arrangement is fair and reasonable "so far as shareholders are concerned". This reflects the Panel's existing expectation and makes it explicit.
Rule 21 restrictions after unequivocal rejection during offer period
- It is proposed that the notes on Rule 21.1 be amended to clarify that, in respect of a potential bidder not publicly identified during an offer period, the frustrating action restrictions cease seven days after the target board has unequivocally rejected the approach, even if the company remains in an offer period (where, for example, the target company has announced a formal sale process). This codifies the existing practice of the Panel.
Rule 28.7 - Investment research and consensus forecasts
- It is proposed that Rule 28.7 be amended to: 1) delete the requirement that forecasts by connected analysts be removed from the target's website at the start of an offer period; and 2) add a requirement, where consensus forecasts include contributions from connected firms, to state the relevant connection between the target and the firm. This proposed change reflects market feedback received by the Panel that it is helpful for research to remain available to shareholders.
Rule 35.1 - Post-offer restrictions on significant asset transactions
- The Panel proposes to amend Rule 35.1 so that restrictions on significant asset purchases following an unqualified no increase / no acceleration statement are aligned more closely with the approach already taken following Rule 2.8 statements.
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