921

Past version: Effective up to 11 Feb 2021

Except in the case of a general mandate, if shareholder approval is required, the circular to shareholders must include:—

(1) details of the interested person transacting with the entity at risk, and the nature of that person's interest in the transaction.
(2) details of the transaction (and all other transactions which are the subject of aggregation pursuant to Rule 906) including relevant terms of the transaction, and the bases on which the terms were arrived at.
(3) the rationale for, and benefit to, the entity at risk.
(4)
(a) an opinion in a separate letter from an independent financial adviser who is acceptable to the Exchange stating whether the transaction (and all other transactions which are the subject of aggregation pursuant to Rule 906):—
(i) is on normal commercial terms, and
(ii) is prejudicial to the interests of the issuer and its minority shareholders.
(b) however, the opinion from an independent financial adviser is not required for the following transactions. Instead, an opinion from the audit committee in the form required in Rule 917(4)(a) must be disclosed:—
(i) the issue of shares pursuant to Part IV of Chapter 8, or the issue of other securities of a class that is already listed, for cash.
(ii) purchase or sale of any real property where:—
•   the consideration for the purchase or sale is in cash;
•   an independent professional valuation has been obtained for the purpose of the purchase or sale of such property; and
•   the valuation of such property is disclosed in the circular.
(5) an opinion from the audit committee, if it takes a different view to the independent financial adviser.
(6) all other information known to the issuer or any of its directors, that is material to shareholders in deciding whether it is in the interests of the issuer to approve the transaction. Such information includes, from an economic and commercial point of view, the true potential costs and detriments of, or resulting from, the transaction, including opportunity costs, taxation consequences, and benefits forgone by the entity at risk.
(7) a statement that the interested person will abstain, and has undertaken to ensure that its associates will abstain, from voting on the resolution approving the transaction.
(8) Where the issuer accepts a profit guarantee or a profit forecast (or any covenant which quantifies the anticipated level of future profits) from the vendor of businesses/assets, the information required in Rules 1013(1) and 1013(2), and a statement confirming that it will comply with Rule 1013(3).