It’s the most wonderful time of the year. Whether you celebrate with tinsel or simply a well-earned break, we think everyone deserves a gift – the greatest gift of all, M&A insights!
To turn the phrase made famous by Wham!: Last Christmas, we gave you our insights. This year, to save you from tears, we’ll give you something even more special.
While re-gifting is socially frowned upon, here at HSF Kramer we encourage it. Repackage these little gems for that special someone in your life to whom it will mean the world. Priced well under Kris Kringle price limits, sustainable, non-wasteful and no batteries required – we are sure these gifts will be treasured by young and old.
Each gift below is neatly wrapped for you. Click, open, enjoy and feel free to pass it on.
So, what are you waiting for? Open your presents!
Gift 1: Mayne Present, Cosette Player
No, it’s not the gift of a Walkman, but they did try and walk, man.
Analogising to the Grinch who stole Christmas, unexpected developments combined to rob Mayne shareholders of their scheme consideration.
While Mayne shareholders may feel empty-handed, there was a bounty of insights gifted to bidders and targets.
The Supreme Court, thanks to a gallant effort from Black J, upheld the market’s expectations that a Material Adverse Change clause should not be easily evoked.
For us, the Takeovers Panel role as a hero regulator in the affair was the greatest gift of all. Prepare to see the Panel more involved in scheme disputes, allowing the aggrieved to access the advantages of speed and breadth of orders that the Panel has over the Courts.
Sadly, the Treasurer and FIRB did not ultimately deliver a Christmas miracle.
Gift 2: Buildup to new competition law regime creates excitement across the market
The New Year’s count down is on, and so too is the count down to the new merger clearance regime.
Competition lawyers around the country are trying to contain their excitement, much like children trying to sleep on Christmas eve. The competition lawyers are equally not getting much shut-eye at the moment.
In the last two months we have seen a flurry of applications for informal clearance to avoid the need to go through the new regime. The ACCC has done a fabulous job pushing as many of these as they can through. It has proven a nice trial run for delivering on speedy approvals.
The thresholds are lower and some of the fees higher than we would have liked, but overall this brings Australia into line with Europe and the United States. Applying the connected entities test in certain circumstances (e.g. private capital funds) has also proven tricky.
How it all plays out early will be keenly watched. Our advice continues to be, where you can, put your best foot forward early to avoid getting into Phase 2.
This quote from Rainer Maria Rike feels apt to leave you with on this topic: “And now we welcome the new year. Full of things that have never been.”
Gift 3: ASX contemplates further bidder restrictions on issuing share consideration
Following a growing chorus (no carols, unfortunately) from the investor community in the wake of the James Hardie/Azek transaction earlier in the year, we are unwrapping another round of potential tightening of the ASX Listing Rules for listed bidders.
ASX has published its consultation on proposed changes to the Listing Rule 7.1 exceptions, to further restrict bidders in issuing share consideration without first obtaining approval from their own shareholders.
ASX can’t wait until Christmas Eve – feedback on their proposed changes is due by mid-December. The regulator seems genuinely interested to hear from other voices on these issues – ASX is conscious of potential issues, including reducing both the competitiveness of listed bidders and the strategic discretion of company boards.
However, change in some form seems inevitable. The key ASX proposal is a reduction in the number of shares a bidder can issue in connection with bid consideration without shareholder approval, from the current cap of 100% of the bidder’s existing share capital (under the current reverse takeover rule) to 25% of existing capital – to be applied to larger listed companies (i.e. ASX300 entities).
At that level, ASX estimates that the new rule would have applied to approximately 20% of all takeovers and schemes involving bidder shares – not a trifling number. And as we all know, increasing conditionality can make some deals tougher to untangle than an ancient string of Christmas lights.
If more regulation is in our stockings for the new year, here’s hoping it doesn’t cause any unnecessary deal indigestion.
Gift 4: New rules for disclosure of derivatives released
On the last sitting day of 2025, Federal Parliament passed a Bill which, among other things, requires market participants to disclose all forms of derivative interests once they reach a notional 5% threshold (in combination with their existing ‘relevant interest’ in securities).
These reforms will come into effect 12 months after the Bill’s Royal Assent (which could occur just in time for Christmas). We expect these reforms will be the gift that keeps on giving throughout 2026 as market participants and compliance teams grapple with the complexities of the new regime, particularly from a reporting and disclosure perspective.
While the format of the new required substantial holder disclosure notices is still uncertain – given the breadth of the types of derivative interests that will be required to be disclosed, we do expect there will a fair amount of disclosures of ir-relevant interests.
Gift 5: High success rate in takeover bids
The last 12 months have seen a lot of scheme proposals fail to proceed for various reasons. Think about proposals for Insignia, Santos, Abacus Storage King, Humm, Vonex, Mayne Pharma, AUB plus a few others (and they are just the ones that became public).
On the other hand, there has been a delightful run of success when takeover bids are launched. We calculate that 23 ASX companies have been subject to takeovers announced since 1 January 2025. It is too early to tell what is going to happen in four as the bids are still open, but there was a change in control of 15 of the other 19. That is an amazing 79% success rate. Outstanding!
Keats wrote:
A thing of beauty is a joy for ever: Its loveliness increases; it will never Pass into nothingness; but still will keep A bower quiet for us, and a sleep Full of sweet dreams, and health, and quiet breathing.
We doubt he had in mind hostile takeovers (he was writing in 1818, after all), but for many people (probably people reading this message), a hostile takeover is a ‘thing of beauty’.
The lesson for target company directors is that, if you are on the receiving end of a takeover bid, chances are you might have more time to catch up on reading and relaxing when it is over.
Gift 6: Scheme meeting surprises
The usual gift of scheme meetings is that they are straightforward, with clear proxy guidance on outcome in advance and a well-trodden process for conducting the meeting. However, 2025 gave us some unexpected excitement (and providing plenty of content for financial journalists), in the form of both the Xref and PointsBet scheme meetings.
The voting down of the Xref scheme by shareholders at the scheme meeting despite a 61% premium, Board recommendation, fair and reasonable IER, best and final offer and (admittedly slightly shaky) proxy position in favour of the scheme was unexpected, but not entirely unpredictable. This reminder of the importance of voter turnout and shareholder engagement means this one is really a gift to the shareholder communications consultants!
Speaking of keeping journos busy, the twists and turns in the PointsBet / MIXI / betr adventure could fill an entire 12 days of Christmas alone. The most entertaining of these was the stoush around the scheme meeting, with PointsBet very confidently asserting that the betr votes, which would vote down the scheme, had been validly excluded, only to reverse tack less than 24 hours later, with Computershare very awkwardly blaming a system error for the invalid exclusion.
Given MIXI (and its controlling stake) and betr (and its not insignificant 27%) are now sharing PointsBet like a divorced couple continuing to share a house because of Sydney property prices, PointsBet may truly be the gift that keeps on giving (to journos and corporate lawyers alike).
Gift 7: Truth Seeking: Love Actually meets Market Integrity
“But for now, let me say, without hope or agenda - Just because it’s Christmas, and at Christmas, you tell the truth, to me you are perfect”.
Those cue cards from the Christmas movie Love Actually* may not be perfect here, but they’re unforgettable. And earlier this year, the spirit of “truth-telling” was tested in the Dropsuite/NinjaOne scheme under ASIC’s long standing “Truth in Takeovers Policy.”
When Dropsuite’s largest shareholder, Topline Capital, first declared it would vote its 31% stake in favour of the deal, the market understandably took comfort. Yet within weeks, that stake was trimmed to 20%. A second statement promising to hold firm until completion followed — only for another sell down to 10% to arrive soon after.
Enter Harvest Lane, the M&A arb fund that decided this wasn’t in the spirt of Christmas. The Panel agreed: the first statement was fuzzy enough to pass as “ambiguous,” but the second was a straight-up breach of ASIC’s policy.
So, cheers to the Panel for reminding us that in markets, as in holiday rom-coms, words matter. Truth and market integrity isn’t seasonal — it’s not just for Christmas, it’s all year round.
Gift 8: ASIC public/private markets paper
ASIC kicked off the year by launching its much talked about discussion paper on the dynamics between public and private markets.
We are not naturally inclined to raise any criticism of the market settings that produced the steady stream of public to private deals of the last decade, so greeted ASIC’s paper inspecting the dynamics between public and private markets with caution.
However, after a year of philosophical musings that are far beyond the skillset of a bunch of deal junkies, we can honestly say we have ended up with a ‘Bravo’ for ASIC, who bestowed upon us the gift of a new suite of settings to get IPOs implemented faster and new public M&A targets on the boards sooner. Put ASIC on the ‘nice’ list.
Gift 9: Panel rejects delisting complaint, sticks to its knitting
What is ‘unacceptable’ – well, it can depend on who you ask.
ASX regulates the exit from its exchange with a simple rule. If more than 12 months has passed since a takeover bid, a special shareholder approval resolution is required to delist.
In Pact Group, the holder of 88% of the shares said ‘delisting, yes please’. This intention had been disclosed in the bidder’s statement of yore, so the market was informed, and the vote would be passed.
‘Unacceptable’ cried a minority, but where should they go? ASX’s policy is clear: except in special cases, the major holder can vote.
To the Takeovers Panel the minority went – to express their concerns ‘I’m being repressed’. The Panel first asked: what is the effect on control? As no impact could be established (based on a delisting alone), the Panel said it lacked jurisdiction (and observed that it does not have a general oversight role over listed entities).
In case there was any doubt, you cannot go to the Panel alleging ‘unacceptable circumstances’ if you are given a present you don’t like (though it does sound tempting).
Gift 10: Records broken by huge scheme booklet in Duxton Farms, despite calls for simplification
Imagine waking up to a large box under your tree. “Santa has come good,” you think. Then you open the box and see tissue paper and a smaller box. Opening the smaller box, you discover a further smaller box, and so forth. You repeat the ritual until left with a small piece of jewellery.
The repetition and torturous waste of material is reminiscent of that which exists in some scheme booklets. At the end of finishing both exercises, one may think, “Why? Simplify this and just give me the gold.”
Disclosure documents for public market transactions have become too long, we think.
This year, the Duxton Dairies scheme booklet was a monster 591 pages. In 1979, the booklet for HC Sleigh Limited was 27 pages.
More broadly, in the late 1990s and early 2000s, the average was ~50 pages from a selection of deals, these days that average is just under 100 pages. \
Length creates complexity, potentially confusing shareholders. It also adds time for ASIC and Court review. The potential loss of core messages and added time, potentially introduces risk for transactors.
We yearn for Christmas’ and scheme booklets of years past. Bring back simplicity, we say!
Gift 11: NBIOs can lead to great outcomes, but many are left wanting
Non-binding indicative offers can be a bit like a festive bon-bon – you never know what you will get and you may be left feeling disappointed! Most recently, EQT’s NBIO for a public-to-private of AUB Group failed to pop, while Genesis Capital’s bid for Monash IVF left the bidder empty-handed, despite a 19.6% pre-bid stake. We answer the question, “what can be learned from the public NBIOs,” as follows (based on CY22-24 data):
- 40% of targets subject to an NBIO reached an agreed deal, 60% did not.
- PE had broadly the same success rate as other bidders.
- 50% of NBIOs are not announced until transaction documents are agreed.
- 12% of NBIOs were announced because of a leak / media speculation.
- 45% of failed PE bids fell over because the bidder withdrew during diligence.
- 83% of bidders who took pre-bid stakes were successful – a good indicator of high conviction.
The New Year is sure to bring with it a bounty of new NBIOs. Here’s hoping to a new season that brings more joy and success for everyone involved.
Gift 12: Our Law Firm’s Combination and League Table Dominance
We thought we would end by reaching new heights. Our final gift is a two-part gift, to be consumed together:
- Part 1: Our combination with Kramer Levin – The gift of true global reach for our clients. Kramer is a predominantly M&A and litigation focussed New York firm with ~120 partners, and growing quickly. Since our combination implementation in June, the direction of travel is very much following our clients into the United States. Much like a poinsettia, this is a gift that will grow and flower for many years to come.
- Part 2: League Table Dominance – For the first 9 months of the calendar year (12 month results not out yet) we have topped the law firm league tables for announced M&A by value. This is no flash in the pan; we have now topped those same league tables over the last 5 years. Also topped them for the last 15 years. In fact, we have topped the league tables over 25 years, since their inception, in case you were wondering.
So, with that, our new year’s resolution is to continue to deliver outstanding client service, top M&A league tables and remain at the cutting edge of Australian M&A. Cheers to that.
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