Technical Updates Q4 2020

Regulatory guidance on foreign takeovers

The UK Government has introduced regulatory guidance on foreign takeovers of UK companies that are deemed ‘sensitive’ for national security purposes.

Foreign buyers of UK companies in specific industries will be required to notify the Government in advance of a transaction, undergo a screening process and receive Government consent before the transaction is able to proceed.

The Government’s screening process is expected to take 30 days. As a result, we may see more drawn-out M&A processes as potential investors are required to undergo the review process alongside existing approval hurdles.

Whilst market commentators have indicated that only a small number of transactions are likely to fall foul of the new regulations, trustees should be aware of this process when their sponsor is involved in such a transaction.

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