MAS amends the Singapore Code on Take-Overs and Mergers

By Suilyn Yip

On 16 June 2026, the Monetary Authority of Singapore, on the advice of the Securities Industry Council (the “Council”), issued a revised Code on Take-overs and Mergers (the “Code”). The amendments to the Code aim to protect the competitive process of take-over and merger transactions, improve certainty and timeliness of schemes of arrangement, and enhance disclosures to investors and shareholders, and came into effect on 16 July 2026.

The Code sets out the non-statutory framework governing take-overs and mergers in Singapore and is administered and enforced by the Council. Its primary objective is to ensure that take-overs and mergers are conducted in accordance with good business practice for the fair and equal treatment of all shareholders. The Code is not concerned with the commercial merits of a transaction; rather, it focuses on the standards of conduct expected of parties in take-over and merger transactions, and how fairness can be achieved.  

The amendments follow the Council’s public consultation on the proposed changes set out in the Consultation Paper on Revision of the Singapore Code on Take-overs and Mergers, which was issued on 5 May 2025. Following the close of the consultation on 5 June 2025, the Council published its Consultation Conclusions on Revision of the Singapore Code on Take-overs and Mergers (the “Consultation Conclusions”) on 16 June 2026, together with the marked-up text of the revised Code.^[1]

This article summarises the key revisions to the Code.

1. Data Protection measures

The revised Code strengthens Rule 13 to mitigate the anti-competitive effects of deal protection measures commonly used in Singapore, such as break fees and exclusivity arrangements.

While the Council decided not to proceed with its original proposal for a general prohibition on deal protection measures and other offer-related arrangements, it considered that there was nonetheless merit in mitigating the anti-competitive effects of some deal protection measures and offer-related arrangements frequently used in mergers and acquisition transactions in Singapore, and has amended the Code to provide guidance in this area. 

1.1 Break fees

The revised Code retains the existing Rule 13 on break fees, but the following amendments made:

(a) If more than one break fee is agreed to by the offeree board, the aggregate sum of all break fees payable must not exceed 1% of total offer value. ^[2] This amendment would help limit the anti-competitive effect of break fees.

(b) The offeree board and its financial adviser in submitting the written confirmation currently required under Rule 13 to the Council, must, in addition to confirming that they believe the fee to be in the best interests of offeree company shareholders, explain why that is so.^[3] This amendment would help ensure that break fees are granted judiciously.

1.2 Exclusivity arrangements and other undertakings

Taking into account the feedback received in this regard, the revised Code introduces the following amendments:^[4]

(a) A clarification that exclusivity arrangements entered into between an offeror and offeree company must be subject to a “fiduciary-out”, i.e., exclusivity arrangements which limit the ability of the offeree company board to engage with competing offerors or potential competing offerors must be subject to the proviso that the offeree directors are relieved of such obligations if it is necessary to discharge their fiduciary duties. This reflects current practice.

(b) Guidance that:

(i) a notification obligation which requires the offeree to disclose the fact of an approach by a potential competing offeror to the original offeror would have limited anti-competitive effect as compared to the provision of detailed information on the competing offer; and

(ii) a matching right which allows an offeror to match or better a competing offer cannot be for a duration that removes any practical likelihood of a potential competing offer. In this regard, a matching period exceeding seven (7) calendar days would normally be regarded as anti-competitive.

(c) A clarification that customary provisions pertaining to representations and warranties, obligations of the offeree company to carry out procedural actions to progress a scheme of arrangement and the non-occurrence of specific events or actions which do not deter competition are permitted.

The Council may require remedial action if such arrangements deter competing offers. 

2. Schemes of arrangement

For take-overs implemented by way of a scheme of arrangement, the revised Code introduces measures aimed at improving certainty and timeliness.

The amendments provide that, where an offer is implemented pursuant to a scheme of arrangement, except with the Council’s consent:

(a) the scheme meeting must be held within six (6) months of the announcement of the scheme;^[5] and

(b) prior to the court sanction hearing, both the offeror and the offeree company must confirm to the Council that all relevant conditions have been satisfied or waived and undertake to be bound by the scheme upon sanction by the Court.^[6]

These amendments would prevent a situation where an offeror might seek to rely upon a long-stop date to lapse its offer where only an immaterial condition is outstanding or by refusing to take the required steps. 

3. Offeror statements

3.1 Holding announcement

Where an announcement of a firm intention to make an offer is premature or inappropriate, a holding announcement may be made in accordance with Note 5 on Rules 3.1, 3.2 and 3.3 of the Code. Subsequently, monthly updates on the progress of such talks are required until a firm intention to make an offer or a decision not to proceed with an offer is announced. Previously, there was no stated deadline for when the potential offeror must clarify its intentions.

In practice, where the potential offeror has not clarified its intentions for a prolonged period, the Council has, after consultation with the potential offeror and offeree company, imposed a put up or shut up (“PUSU”) deadline for the offeror to clarify its intentions by either announcing (a) a firm intention to make an offer or (b) that it will not be making an offer. The PUSU deadline would take into account factors such as the readiness of the offeror to make an offer but will not normally be more than 28 days from the date the deadline is imposed.^[7]

To provide greater clarity, the Note 5 on Rules 3.1, 3.2 and 3.3 has been amended to codify the Council’s approach by setting a 28-day PUSU deadline, while preserving the Council’s discretion to impose an earlier or later deadline where appropriate.

3.2 Indicative offer price

The disclosure of an indicative offer price is normally not permitted prior to an announcement of a firm intention to make an offer being made except in exceptional circumstances. Exceptions have been made, for example, where overseas regulatory requirements require an offeror or offeree company to disclose an offer price prior to the announcement of a firm intention to make an offer. In such cases, the Council has imposed a 28-day PUSU deadline and required that the firm offer be made at no less than the indicative price.^[8]

To provide greater clarity, a new Note 8 on Rules 3.1, 3.2 and 3.3 has been introduced to codify the Council’s approach.

3.3 Delay before subsequent offer where a no increase statement or a no extension statement was made

Rule 33.1(a) of the Code imposes a 12-month delay on a subsequent offer by an offeror whose offer has been withdrawn or lapsed. Previously, the Council would normally grant consent for a new offer during the 12-month sit-out period if the new offer was recommended by the offeree board.

The revised Code qualifies that position where the offeror had previously made a no increase statement or no extension statement. The amendments provide that such offerors are restricted from making a subsequent improved offer within the 12-month sit-out period, even with the offeree board’s recommendation, until after the later of:

(a) three (3) months from the date on which the previous offer was withdrawn or lapsed; and

(b) the end of the offer period of any competing offer existing at the time the previous offer lapsed or is withdrawn.^[9]

The Council’s rationale is that an offeror should be held to a no increase statement because offeree company shareholders may have made decisions on their holdings of shares based on that statement, and where a competing offer existed when the first offer lapsed or was withdrawn, the competing offeror should be allowed to complete its offer undisturbed before the first offeror can return with a subsequent offer.^[10]

4. Frustrating actions^[11]

Rule 5 of the Code prohibits the taking of any action that could effectively result in any bona fide offer being frustrated or in shareholders being denied an opportunity to decide on its merits, without shareholder approval in general meeting. Previously, there was little guidance on the information to be provided to shareholders to approve the frustrating action beyond the requirement that the notice convening such meeting must include information about the offer or anticipated offer.

To facilitate shareholder decision-making, the revised Code requires an offeree company board to undertake the following where shareholder approval is sought in general meeting for a proposed frustrating action:

(a) obtain competent independent advice as to whether the financial terms of the proposed action are fair and reasonable and the substance of such advice must be made known to its shareholders;

(b) consult the Council on the timing of the meeting; and

(c) send a circular to shareholders with the specified information.^[12]

The revised Code also clarifies that where a proposed frustrating action is conditional on the offer being withdrawn or lapsing, the requirement for shareholders’ approval would normally be waived on the basis that shareholders will not be denied the opportunity to consider the offer on the table. Such a waiver would be conditional upon the disclosure of information on the proposed action in an announcement or where the Council deems necessary, a document to be sent to shareholders.^[13]

5. Sale of all or materially all of the offeree company’s assets

Previously, the Code did not apply to transactions under which the offeree board, in competition with an offer for voting rights, proposed to sell all or materially all of the company’s assets and to return to shareholders all or materially all of the company’s cash balances, including any asset sale proceeds.

However, the Council considered that shareholders are likely to compare the economic outcomes of an asset sale and an offer for voting rights when deciding whether to accept the offer. There was also concern that the offeror for voting rights could be disadvantaged vis-à-vis the asset acquirer, given that only the offeror for voting rights had to comply with the Code.^[14]

To address these issues, the revised Code:^[15]

(a) provides that where an asset sale competes with an offer for shares, the offeree company must disclose the quantified expected cash proceeds to be returned to shareholders from the asset sales, which is to be treated as a profit forecast subject to reporting requirements^[16] under the Code; and

(b) clarifies that the Council would normally regard a person to be seeking to acquire materially all of the assets and/or businesses of a company if such assets and/or businesses account for or contribute more than 30% of the offeree company’s sales, earnings, assets or market capitalisation.

6. Disclosure of aggregate offer-related fees to offerors^[17]

Another notable amendment is the addition of Rule 8.8, which requires the offeree company to disclose to all offeror(s), including potential offeror(s), an estimate of aggregate fees and expenses (either as a specific amount or as a range, setting out the expected maximum and minimum amounts payable), which could potentially be incurred by the offeree company in connection with the offer.

The new Rule 8.8 also requires that:

(a) where the aggregate fees and expenses payable are likely to exceed the estimated maximum previously disclosed by 10% or more, the offeree company must promptly disclose to all offeror(s), including the potential offeror(s), revised estimates of the aggregate fees and expenses expected to be incurred in relation to the offer; and

(b) where the final fees and expenses actually paid exceed the amount disclosed as the estimated maximum payable by 10% or more, the offeree company must promptly disclose to all offeror(s), including the potential offeror(s), the final amount paid.

7. Other amendments

The revised Code also makes several other disclosure, information-sharing and clarificatory amendments, including updates to the equality of information requirements, information sharing with competing offerors, the use of videos and social media in offer-related communications, and the treatment of asset valuations more than three months old as not current.

8. Conclusion

The amendments reflect the Council’s continuing approach of keeping the Code under review in light of market developments and evolving international practices. Parties involved in, or contemplating, take-over or merger transactions should review the revised Code and the Consultation Conclusions in full, and should consider consulting the Council where there is doubt as to the application of the revised rules to an ongoing or proposed transaction.

---