MAS Revises Singapore’s Takeover Code: Key Changes

Following a public consultation commenced by the Securities Industry Council (SIC) in May 2025, the Monetary Authority of Singapore (MAS), on the advice of the SIC, has announced amendments to the Singapore Code on Take-overs and Mergers (Code), which will take effect on 16 July 2026. The amendments are intended to enhance transparency, strengthen shareholder protection, and promote a competitive takeover environment, while aligning the Code with evolving market practices and international standards. This LawFlash summarises the key changes and their implications for market participants.

KEY CHANGES

Thresholds and Definitions

The revised Code introduces several changes to key definitions, including the following:

• Control: The threshold for “control” has been increased from 20% to 30% of a company’s voting rights.
• Associate: The definition of “associate” has been narrowed by removing (1) banks; and (2) directors of companies within the offeror’s or offeree company’s corporate group and certain related associated companies, from automatic inclusion. The Code has also been amended so that these directors are no longer automatically presumed to be acting in concert with the offeror or offeree company.
• Close relatives: The definition has been expanded to include grandparents, grandchildren, cohabitants, civil partners and a wider range of in-law relationships.

 Procedural Reforms and Deal Timelines

The SIC’s ability to require a potential offeror to clarify its intentions within a specified timeframe where uncertainty has persisted for an extended period has now been codified. In such cases, the SIC may require the potential offeror to either announce a firm intention to make an offer or make a “no intention to bid” statement within 28 days (or other such period as the SIC may determine).

Furthermore, where a potential offeror publicly discloses an indicative offer price before announcing a firm intention to make an offer, any subsequent offer must be made on the same or better terms. The potential offeror must also, within 28 days of the disclosure (or such other period as the SIC may determine), either announce a firm intention to make an offer or make a “no intention to bid”statement.

Additionally, the shareholder meeting to decide on a scheme of arrangement must now be convened within six months of the initial scheme announcement; previously, no time limit had been imposed. Following the receipt of shareholder approval, both the offeror and offeree company are required to take all necessary procedural steps promptly to implement the scheme.

Information Disclosure and Equality

The revised Code strengthens the principle of equal information access among competing offerors. Subject to an exception for formal sale processes, an offeree company must, upon request, provide an offeror or bona fide potential offeror with the same information that has been made available to another offeror or potential offeror. This requirement extends beyond documents and data room materials to include site visits and meetings with management, with equivalent access required to be provided as far as practicable.

The amendments also clarify that information sharing may only be subject to limited conditions relating to confidentiality, reasonable non-solicitation restrictions and use of the information solely in connection with an offer or possible offer. Any such conditions must be applied consistently across competing offerors.

At the time of publication of the offeree board circular, the offeree company is now required to disclose to all offerors and potential offerors its estimated aggregate offer-related fees and expenses, including advisory, legal, accounting, public relations and other professional costs. Where actual or expected fees exceed the previously disclosed maximum estimate by 10% or more, the offeree company must promptly provide updated disclosures. The amendments also require greater transparency around variable or uncapped fee arrangements, including the basis on which such fees are calculated and reasonable estimates of the amounts likely to be payable. In a case where break fee arrangement is included as part of the transaction, there is also now a requirement for an explanation as to why the offeree company and its financial adviser believe that such a break fee is in the best interests of the shareholders of the offeree company.

Deal Protection Measures and Break Fees

The revised Code introduces additional safeguards to ensure that deal protection measures do not unduly deter competing bids:

• Break fees: Break fees remain permitted, but the aggregate value of all break fees payable by the offeree company should not exceed 1% of the offeree company's value (calculated by reference to the offer price), and are only payable if an offer becomes or is declared unconditional.
• Implementation agreements and exclusivity arrangements: The SIC has also provided greater guidance on implementation agreements and exclusivity arrangements. Any restrictions on the offeree company’s ability to engage with competing bidders must be subject to a fiduciary-out, allowing directors to comply with their duties. Notification obligations should generally be limited to informing the original offeror of the existence of a competing approach, rather than disclosing detailed information about competing bids. In addition, matching rights are generally limited to no more than seven days, as longer periods may have an anti-competitive effect by discouraging rival bidders.

The SIC may require remedial action, and may initiate disciplinary action, where it considers an implementation agreement or deal protection measure to be inconsistent with Rule 13 of the Code. To preserve the parties’ ability to comply with any SIC direction, the Code requires a clause providing that any provision requiring the offeree company to take, or refrain from taking, action that is determined by the SIC to be not permitted by Rule 13 of the Code will have no effect and will be disregarded.

Frustrating Actions and Independent Advice

Where shareholder approval is required for an action that may frustrate an offer, the offeree board must obtain independent advice on whether the financial terms of the proposed action are fair and reasonable and disclose the substance of that advice to shareholders. The board must also provide shareholders with sufficient information to make an informed decision, including details of the proposed action, the board’s views and the status of the offer. The offeree board must also consult the SIC on the date of the general meeting.

The SIC may waive the shareholder approval requirement where the proposed action is conditional upon the offer being withdrawn or lapsing, subject to appropriate disclosure.

Asset Sales During Offer Periods

The revised Code introduces new requirements where an offeree company proposes, in competition with an offer or possible offer, to sell all or substantially all of its assets or business and return the proceeds to shareholders. For these purposes, a sale will generally be regarded as involving “substantially all” of the company’s assets or business where the assets represent more than 30% of the offeree company’s sales, earnings, assets, or market capitalisation. Where the offeree company quantifies the amount of cash expected to be returned to shareholders (whether as a specific amount or a range), that statement will be treated as a profit forecast and must comply with the applicable reporting and disclosure requirements under the Code. The offeree company must also disclose the expected timing of the distribution.

Further, to preserve equality of treatment among shareholders, the revised Code generally prohibits the asset purchaser and its concert parties from acquiring shares in the offeree company during the offer period unless the offeree company has quantified the amount per share expected to be distributed to shareholders. Once such disclosure has been made, acquisitions are permitted only at a price not exceeding the disclosed distribution amount (or the bottom of any disclosed range of distribution amount).

Media and Communications

The revised Code extends its communications framework to cover videos, webcasts, podcasts, and social media. Videos, webcasts, and podcasts containing information or opinions relating to an offer or the financial performance of companies involved in an offer must feature a director or senior executive reading from a script or participating in a scripted interview, may only be published with the SIC’s prior consent, and must be released on SGXNet and the relevant party’s website.

The amendments also introduce clearer restrictions on the use of social media during an offer. Offer-related communications on social media are generally limited to reproducing approved announcements, documents and SIC-approved videos, or providing neutral links to such materials. Any social media notification must be confined to factual, non-controversial information and must not include arguments, opinions, recommendations, or commentary on the merits of an offer.

KEY TAKEAWAYS

The 2026 amendments reinforce the SIC's focus on transparency, shareholder protection and competitive bidding processes.

Offerors, offeree companies, and their advisers should review their transaction planning, implementation agreements, information-sharing protocols, shareholder communications and media engagement practices to ensure compliance with the revised Code. Particular attention should be paid to the revised definitions, enhanced disclosure, and equal treatment requirements, restrictions on deal protection measures, and the updated procedural requirements applicable to schemes of arrangement and frustrating actions. Early consideration of these changes will help minimise regulatory and execution risk in take-over transactions.