JPN EXC proposed revisions to the Listing rules re MBOs and subsidiary conversions.
Revisions aim to enhance the effectiveness of JPN METI's Fair M&A guidelines by improving governance and disclosure practices in MBOs and subsidiary conversions.
Outline of Revisions
When deciding whether to conduct a management buyout (MBO) or full acquisition by a controlling shareholder or other related parties, listed firms shall obtain an opinion stating that such transaction will not undermine the interests of minority shareholders.
Such opinion shall be obtained from a special committee which is composed of external directors, external auditors, as well as external experts with no vested interest.
Opinion as to fairness to general shareholders must include the committee's conclusion on the adequacy of the proposed action, fairness of transaction terms and procedures.
Listed companies must make timely disclosures for decisions on subsidiary conversions, and establish an investor relations framework to ensure the provision of necessary information for building relationships with shareholders and investors.
Effectiveness
Comments shall be submitted by May 14, 2025 for planned effectiveness in Jul. 2025.
