Malaysia. Shearn Delamore & Co.

Transcription

1 Malaysia Shearn Delamore & Co. 1. What has been the general level of M&A activity over the last 12 months in your jurisdiction? What were the most notable mergers and acquisitions during that period? It was reported in the Securities Commission s Annual Report 2012 that in 2012, the Securities Commission received a total of 35 applications for clearance of offer documents involving a total offer value of billion ringgit, as compared to 23 applications in 2011 involving a total offer value of billion ringgit. There were also many international cross-border M&A transactions involving assets and companies in Malaysia, which were not included in the latter statistics, as they did not require the approval of the Securities Commission. Amongst the notable mergers and acquisitions deals over the last 12 months are: Property The offer by Permodalan Nasional Bhd and Tan Sri Dato Sri Liew Kee Sin for the remaining shares in SP Setia Bhd valued at 5.7 billion ringgit. This is the largest Malaysian takeover offer of a Malaysian company in terms of offer value in Insurance The acquisition of ING Management Holdings (Malaysia) Sdn Bhd by AIA Group Ltd for 5.29 billion ringgit, which was completed in December With the acquisition, AIA has emerged as the largest life insurer in Malaysia in terms of total premium revenue of US$2.05 billion post acquisition. 1 Oil and gas The RM11.85 billion merger between Kencana Petroleum Bhd and Sapura Crest Bhd in May 2012 formed the largest integrated oil and gas service provider by assets in Malaysia, known as Sapura-Kencana Petroleum Berhad. Under a cash and share swap deal, a special purpose vehicle, Intergral Key Sdn Bhd made the offer to acquire all the as sets and liabilities of SapuraCrest for 5.87 bil lion ringgit and Kencana for 5.98 billion ringgit. 2 Solar Hanwha Chemical Corporation s (listed on the Korean stock exchange) successfully bid for and acquired Q-Cells SE s headquarters in Germany, its production facilities in Germany and Malaysia and its sales offices in the US, Australia and Japan positioning it as the third largest solar manufacturer in the world. 3 Retail AEON Co Ltd s (Japan) acquisition of Carrefour s Malaysian operations through a new entity, AEON BIG (M) Sdn Bhd. The deal was to acquire Carrefour s Malaysian hypermarket operating subsidiary Magnificient Diagraph Sdn Bhd and Carrefour Malaysia Sdn Bhd for the purchase price of 147 million euros. The acquisition was completed in October 2012 and with the acquisition of the Carrefour s Malaysian operations, AEON becomes the 2nd largest retailer group in Malaysia

2 LEXISNEXIS MERGERS & ACQUISITIONS LAW GUIDE What are the most common methods for acquiring or merging with a public company in your jurisdiction? The most common methods of acquiring a public company in Malaysia are: 1. Acquisition of shares of the company through sale and purchase agreement; 2. Acquisition of assets and liabilities of the company; 3. Takeover of the company by way of voluntary offer or mandatory offer in accordance with the Malaysian Code on Take-overs and Mergers 2010 (hereinafter known as the Code ); and companies; 3. Companies Act 1965 (CA 1965), which contains, inter alia, provisions that govern the conduct and affairs of companies, the director s duties, disclosure requirements on substantial shareholding and schemes of arrangements; and 4. Bursa Malaysia Listing Requirements 2010 (Listing Requirements), which apply to a company listed on the Bursa Malaysia Stock Exchange and contains rules that govern the conduct of a public listed company, including disclosure requirements, public spread requirements and other requirements during the M&A process. 4. Scheme of arrangement under s 176 of the Companies Act 1965, which is regarded as a takeover offer regulated under the Code. 3. What are the key laws and regulation that govern mergers and acquisitions in your jurisdiction? The key laws and regulations that govern mergers and acquisitions in Malaysia are: 1. The Code, Practice Notes and Guidelines on Contents of Applications relating to Takeovers and Mergers issued by the Securities Commission, which governs the conduct of all persons involved in takeover offers, mergers and acquisitions in Malaysia, and is administered by the Securities Commission; 2. Capital Markets and Services Act 2007 (CMSA 2007), which contains, inter alia, provisions that regulate the activities of markets and intermediaries in Malaysian capital markets and substantial shareholding reporting requirement. Part VI Division 2 of CMSA 2007 contains provisions to govern takeovers, mergers and acquisitions of 4. What are the government regulators and agencies that play key roles in mergers and acquisitions? The main regulators for M&A activity in Malaysia are: 1. Securities Commission (SC) SC has regulatory power to regulate the takeover, merger and acquisition of companies and to ensure compliance with the provisions of securities laws; 2. Companies Commission of Malaysia (CCM) CCM is empowered, amongst others, to administer and enforce the Companies Act 1965; 3. Bursa Malaysia Securities Berhad (Bursa) Bursa which operates Malaysia s stock exchange is the front line regulator with the primary responsibility to oversee compliance by listed companies with the Listing Requirements; 4. Bank Negara Malaysia (Malaysian Central Bank) the Malaysian Central Bank 144

3 MALAYSIA administers the regulation of the financial sector and its power includes the consideration of applications for approval for the acquisition of interests in financial institutions ; and 5. Other Regulatory/Licensing authorities Government agencies, regulators (including industry regulators) and/or local authorities may impose specific conditions or other requirements. Such conditions depend on the industry in which the target company operates. 5. Are hostile bids permitted? There is no prohibition under the Code on hostile bids. In fact, there are a number of provisions under the Code, which relate to competing takeovers. Hostile bids are uncommon in practice and one of the reasons may be due to the lack of opportunity for potential bidders to conduct due diligence on the target company. The only information available in respect of the target company in hostile bid situations is normally limited to those available in the public domain (see Question 10 for information in public domain). 6. What laws may restrict or regulate certain takeovers and mergers, if any? (For example, anti-monopoly or national security legislation). The main anti-monopoly legislation in Malaysia is the Competition Act 2010 (CA 2010), which came into effect on 1 January There are no merger control provisions under the CA 2010 but there are provisions that prohibit anti-competitive practices and abuse of dominant market position. The CA 2010 is aimed at regulating agreements between enterprises which have the object or effect of significantly preventing, restricting or distorting competition in any market for goods and services in Malaysia and conduct which amounts to abuse of dominance in the relevant market. In the past, the Guidelines on the Acquisition of Interests, Mergers and Takeovers by Local and Foreign Interests in 2009 (hereinafter known as Foreign Investment Guidelines ) restricted foreigners in the percentage of shares they may own in a Malaysian company. This restriction worked in parallel with similar prescriptions by other government ministries such as the Ministry of International Trade and Industry, which is the licensing authority for manufacturing companies. Since the abolishment of the Foreign Investment Guidelines, there is no longer a general restriction on the foreign ownership of shares in Malaysian companies. However, such limitation is now industry specific and is regulated and administered by the relevant government ministry or body such as Malaysian Central Bank. 7. What documentation is required to implement these transactions? Other than the usual sale and purchase documentation, in the case of a general offer under the Code, the following documentation is required: 1. Announcement for notice of a takeover offer, which must be immediately made by the offeror of his firm intention to make a takeover to the public by press notice, ie at least three main national newspapers (one in the national language and one in English), and by written notice to the target s board of directors, the SC and Bursa if the target is listed. The announcement of the takeover must contain, inter alia, the following information: a. The identity of the offeror and all person acting in concert (hereinafter known as Pac ); b. The basis of the offer price; c. The basis of consideration, if other than by cash; 145

4 LEXISNEXIS MERGERS & ACQUISITIONS LAW GUIDE 2015 d. The type and total number of voting shares or voting rights of the target company which have been acquired by the offeror; e. The details of the agreements relating to the acquisition; and f. The terms and conditions of the takeover offer. 2. Announcement of the receipt of the takeover notice, which must be made by the target s board of directors to the public by press notice or to Bursa if the target is listed. This announcement must contain all information disclosed to the target s board of directors and a statement as to whether they are seeking an alternative offer. 3. Offer document, which must be submitted to the SC for its consent. The offeror is required to disclose in the offer document, all information that the target s shareholders and their advisors would reasonably require and expect to find for the purpose of making an informed assessment as to the merits of accepting or rejecting the takeover offer and the extent of the risks involved. The offer document shall contain all information and statements as required under the First Schedule of the Code, including: a. The identity of the ultimate offeror; b. The terms and conditions of the takeover offer; c. The offeror s intentions with regard to the continuation of the target s business and the major changes to be introduced in the target s business; d. The offer price and the confirmation that the offeror has sufficient financial resources where the takeover is by cash; and e. Whether the offeror intends to invoke the right of compulsory acquisition. 4. Target board s circular, which must be issued by the target s board of directors to every shareholder. The circular will contain the board of director s comments, opinion and information on the takeover offer and must contain all information that the target s shareholders and their advisors would reasonably require and expect to find for the purpose of making an informed assessment as to the merits of accepting or rejecting the takeover offer and the extent of the risks involved. 5. Independent advisor s circular, which is to be issued by an independent advisor containing its comments, opinions, information and recommendation on the takeover offer to the target s board of directors, shareholders and holders of convertible securities. The independent advisor s circular must include the information set out in the Second Schedule of the Code. 8. What government charges or fees apply to these transactions? The fees payable to the SC in respect of takeovers, mergers and compulsory acquisitions are prescribed under the Capital Markets and Services (Fees) Regulations The amount payable varies depending on the type of application to the SC. For example, in respect of an application to the SC for its clearance of offer document, under the current regulations, the fees payable are calculated as follows: 1. For an offer value from 1.00 ringgit to 2.98 billion ringgit, the fee payable is 10, ringgit % of offer value (up to 2.98 billion ringgit); and 2. Any remaining sum above the offer value of 146

5 MALAYSIA 2.98 billion ringgit, the additional fee payable is per cent of the remaining offer value. In the case of a circular to shareholders requiring Bursa s review (either limited review or full review), a fee may be charged by Bursa and the amount payable is to be determined by Bursa from time to time. Apart from the above, stamp duty is payable in relation to the transfer of shares and property. 9. When conducting due diligence, what information is required to be publicly disclosed? The overriding principle under the Listing Requirements in respect of information that has to be disclosed is that a listed company has to immediately disclose all material information. Information is considered material if it is reasonably expected to have a material effect on the price, value or market activity of any listed company s securities or the decision of the shareholder or investor in determining his choice of action. Material information includes information which concerns the listed issuer s assets and liabilities, business, financial condition or prospects. In the situation where there is a potential takeover of a listed company, which may involve the conduct of due diligence by potential bidder/purchaser, there are a number of circumstances where the target company may be under an obligation to make an announcement for, eg: Consistent with the thorough public dissemination policy which forms part of the disclosure policies, the Listing Requirements provide that no disclosure of material information should be made on an individual basis or selective basis unless such information has been previously disclosed and disseminated to the public. Further, in the circumstances where selective disclosure of material information is necessary, for example, where the listed company is undertaking a corporate exercise or to facilitate a due diligence exercise, the listed company must still ensure that disclosure is restricted to only relevant persons and the strictest confidentiality is maintained. In practice, this may necessitate any material information that has not been previously announced if disclosed to a potential bidder in the course of due diligence to be immediately announced. 10. What sources of information are available in the public domain? Information that is available in the public domain is that, which is by law required to be lodged with the relevant authorities, such as: 1. Information/documents which are statutorily required to be lodged with or maintained by the CCM under the CA 1965, including: a. Memorandum and articles of association of the target company; b. Form 8 (certificate of incorporation of public company) or Form 9 (certificate of incorporation of private company); Where there is unusual movement in the price of the potential target company s voting shares or voting rights Where the potential target company becomes the subject of rumours or speculations about a possible takeover offer c. Form 24 (return of allotment of shares); d. Form 34 (statement of particulars to be lodged with charge); e. Form 49 (return giving particulars in register of directors, managers and secretaries and changes of particulars); and 147

6 LEXISNEXIS MERGERS & ACQUISITIONS LAW GUIDE 2015 f. Annual return and audited accounts; 2. Information/documents which are lodged by listed companies with Bursa pursuant to the Bursa Malaysia Listing Requirements. They include: a. Announcements; b. Circulars and notices to shareholders; c. Annual reports and audited accounts; d. Quarterly financial reports; and e. Prospectuses; and 3. Other information posted on the target company s website. percentage ratio in respect of the transaction is five per cent or more. 12. Do directors and controlling shareholders owe a duty to the stakeholders in connection with a deal? Under the CA 1965, a director of a company owes a duty to exercise his powers for a proper purpose and in good faith in the best interest of the company; and to exercise reasonable care, skill and diligence with: 1. The knowledge, skill and experience which may reasonably be expected of a director having the same responsibilities; and 11. Do shareholders have consent or approval rights in connection with a deal? Shareholders on a collective basis may have consent/approval rights under the CA 1965 in the situations as prescribed there under, such as: 1. Acquisition or disposal of any company s undertaking or property of a substantial value; and 2. Any arrangement or transaction where a director or a substantial shareholder of the company or its holding company, or a person connected with such a director or substantial shareholder acquires from the company or disposes to the company shares or non-cash assets of the requisite value. In the case of listed companies, the question of when shareholders will have to give their consent or approval to a transaction will depend on the percentage ratio (computed based on the formulas stipulated under the Listing Requirements) applicable to the transaction ie 25 per cent or more unless in the case of related party transactions where shareholders approval will be required where the 2. Any additional knowledge, skill and experience, which the director in fact has. There are no specific duties imposed on the controlling shareholders of companies under the CA However, the CA 1965 provides remedies where the controllers of companies misuse their positions of power in an oppressive, unfairly discriminatory or prejudicial manner towards members. The members that are being oppressed may seek remedies from the Court, such as an order to direct or prohibit any act or cancel or vary any transaction, or an order to wind up the company. 13. In what circumstances is break-up fees payable by the target company? Whilst there is no specific prohibition against the payment of break-up fees under the Code, the issue commonly encountered when such provision is to be included as part of a proposed acquisition is whether it would be in breach of s 67 of the CA 1965 which prohibits a company from providing, whether directly or indirectly, any financial assistance for the purpose of or in connection with a purchase or subscription of its own shares. Hence, if a break-up fee was to be paid by the target 148

7 MALAYSIA company, they would be prohibited under s 67. Break-up fees if not payable by the target company may be possible. 2. Whether or not a particular event happens, being an event that is within the control of or is a direct result of an action by the offeror or any Pac with the offeror. 14. Can conditions be attached to an offer in connection with a deal? Depending on the type of the offer, the Code stipulates certain conditions that must be or may be imposed: Mandatory offer: An offeror must include in the offer document an acceptance condition that the takeover offer will be subject to the offeror having received acceptances which would result in the offeror and all Pacs with offeror holding in aggregate more than 50 per cent of the voting shares or voting rights of the target company. No other condition is permitted. Voluntary offer: An offeror must include in an offer document an acceptance condition that the takeover offer will be subject to the offeror having received acceptances which would result in the offeror holding in aggregate more than 50 per cent of the voting shares or voting rights of the target company. In addition, a voluntary offer may be conditional upon a higher level of acceptances, eg 90 per cent of the shares that enables the offeror to compulsorily acquire the remaining 10 per cent who have not accepted subject to the offeror having satisfied the SC that he is acting in good faith in imposing such high level of acceptances. The level imposed may affect the continued listed status of the target company. 15. How is financing dealt with in the transaction document? Are there regulations that require a minimum level of financing? Under the Code, where the takeover offer is for cash or includes an element of cash, an offeror must ensure and his financial advisor must be reasonably satisfied that: 1. The takeover offer would not fail due to the insufficient financial capability of the offeror; and 2. Every target company s shareholder who wishes to accept the takeover offer would be paid in full. An offer document submitted by the offeror for a takeover offer, as required under the First Schedule to the Code, must include a statement made by the offeror and its financial advisors that they satisfied that: 1. Where the takeover offer is by cash, either in part or in whole, the offeror has sufficient financial resources and the takeover offer would not fail due to insufficient financial capacity of the offeror; and 2. Every shareholder who wishes to accept the takeover offer will be paid in full. An offeror, in a voluntary offer, may include conditions except a defeating condition however expressed, where the fulfilment of which depends on: 1. An opinion, belief or other state of mind of the offeror or any Pac with the offeror; or 16. Can minority shareholders be squeezedout? If so, what procedures must be observed? Section 222 of the CMSA 2007 confers on the offeror the right to invoke a squeeze-out mechanism, which 149

8 LEXISNEXIS MERGERS & ACQUISITIONS LAW GUIDE 2015 enables a successful offeror to compulsorily acquire the shares of dissenting shareholders who have not accepted the bid where the offeror s offer to acquire all the shares or all the shares in any particular class in a target company has, within four months after the making of the offer, been accepted by at least 90 per cent in the nominal value of those shares of that class (excluding shares already held at the date of the takeover offer by the offeror or Pac). In order to invoke s 222 of the CMSA 2007, the successful offeror is required to give a notice (hereinafter known as Requisite Notice ), within two months from the date the 90 per cent acceptance condition has been achieved by the offeror, to the dissenting shareholders to indicate its desire to acquire their shares together with a copy of a statutory declaration by the offeror that the conditions for the giving of the notice are satisfied. Upon receipt of such Requisite Notice, the dissenting shareholders may serve upon the offeror a written demand requesting for a written statement of the names and addresses of all other dissenting shareholders as shown in the register of members (hereinafter known as Demand Statement ) and the offeror is not entitled to acquire the shares of the dissenting shareholders until 14 days after the posting of the Demand Statement. After the giving of the Requisite Notice and statutory declaration, and subject to compliance with any request for a Demand Statement, the offeror may acquire the remaining shares on the terms of the takeover offer as being applicable to the dissenting shareholders. Upon the expiration of one month from the Requisite Notice, the offeror is required to send a copy of the Requisite Notice and an instrument of transfer executed on behalf of all such dissenting shareholders by the offeror together with the consideration for the shares concerned to the target company. 17. What is the waiting or notification period that must be observed before completing a business combination? The Code only specifies the timeline for conducting a takeover offer starting from the moment a firm intention to make an offer is announced until the offer is closed or lapses. There is no timeline prescribed by the Code for the completion of a business combination. The timeline for takeover offer specified under the Code is set out as follows: Day(s) Matters to be undertaken Notice day (hereinafter known as ND ) The offeror is required to immediately announce the takeover offer by press notice and also send a written notice (hereinafter known as Written Notice ) of the takeover offer to the board of directors of the target company, the SC and Bursa if the securities of the target company are listed on the stock exchange. ND + 1 ND + 4 The target s board of directors must make an announcement to the public by way of press notice and also to Bursa in writing if the target company is listed within 24 hours of the receipt of the Written Notice. The offeror is required to submit the offer document to the SC for its consent within four days from the date of sending the Written Notice. 150

9 MALAYSIA ND + 7 The target s board of directors must dispatch an announcement of the receipt of the Written Notice to all target s shareholders within seven days of the receipt of the Written Notice. Posting day ND + 21 (hereinafter known as D ) D + 10 The offeror is required to dispatch the offer document as consented to by the SC to the target s board of directors and shareholders within 21 days from ND. The target s board of directors must issue its comments, opinion and information on the takeover offer in the form of a circular to all target shareholders within 10 days from D. The independent advisor appointed by the target s board of directors must issue its comments, opinion, information and recommendation on the takeover offer in an independent advice circular to the target s board of directors, shareholders, holder of convertible securities within 10 days from D. D + 21 The offeror is required to keep the takeover offer open for acceptance for at least 21 days from D (hereinafter known as offer period ). The takeover offer may be accepted by the target s shareholders on any day after the dispatch of the offer document until the closing of the takeover offer, which must not be later than 74 days from D. Where there is a competing takeover offer made during the offer period, the approved offer document will be deemed to have been posted on the date that the competing takeover offer document was posted. Where the offeror revises the takeover offer, the offeror is required to keep the offer open for acceptance for at least another 14 days from the date of the posting of the revised takeover offer to the target s shareholders. D + 46 The offeror is not permitted to revise the takeover after the 46th day from D. Where there is a competing takeover offer, the offeror is also not permitted to revise the takeover offer after the 46th day from the date on which the offer document relating to the competing takeover offer was posted to the target s shareholders. 151

10 LEXISNEXIS MERGERS & ACQUISITIONS LAW GUIDE 2015 D + 60 The takeover offer will lapse after 60 days from D if the offeror has not received acceptances that would result in the offeror and all Pac holding, in aggregate, more than 50 per cent of the voting shares of the target company to which the takeover offer relates. D + 60 will be the closing date of the takeover offer where the takeover offer has become or been declared unconditional as to acceptances as at D. In the event that the takeover offer has become or is declared unconditional as to acceptances on or before D + 46, the offer must be kept open for acceptances for not less than 14 days from the date on which the takeover offer becomes or is declared unconditional and the closing date of the takeover offer must be not later than D D + 74 In the event that the takeover offer has become or is declared unconditional as to acceptances on any day after D + 46, the offer must be kept open for acceptances for not less than 14 days from the date on which the takeover offer becomes or is declared unconditional and the closing date of the takeover offer must be not later than D Are there any industry-specific rules that apply to the company being acquired? Yes. The rules will depend on the industry target company is in. For example, the banking and insurance industries are governed by the Financial Services Act 2013 which came into force on 30 June 2013 whilst the manufacturing industry is governed by the Industry Co-Ordination Act Certain industries may require licensing under the relevant laws, regulations and/or guidelines and the relevant regulators may impose certain conditions on the terms of the licences in relation to the manner of the businesses to be operated, acquired or disposed, such as restriction on the foreign shareholding, approvals required for changes of ownership of a company and approvals required for reaching certain threshold for acquisition or disposal of shares in certain regulated industries. For instance, the approval of the Malaysian Central Bank is required prior to entering into an agreement or arrangement to acquire any interest in shares of a licensed institution (for banking and insurance business) by which a person would hold five per cent or more in the shares of the licensed institution; whilst the approval of the Minister of Finance is required for any person who has an aggregate interest in shares of a licensed institution of more than 50 per cent or has control over the licensed institution to enter into an agreement or arrangement to dispose any interest in shares of the licensed institution. 19. What are the main tax issues that can arise from the typical deal structures? Capital Gains Tax: There is no capital gains tax in Malaysia apart from real property gains tax (RPGT). RPGT is levied on capital gains accruing on the disposal of any property or shares in a real property company (RPC), as defined. Capital gains from the disposal of real property or RPC shares held for more than five years are currently exempt from RPGT. 152

11 MALAYSIA Tax losses and Capital Allowances: Tax losses and unabsorbed capital allowances remain with the company. If the company is liquidated, the unutilised tax losses, unabsorbed capital allowances etc. would be lost. 20. Are cross-border transactions subject to certain special legal requirements? Cross-border transactions are generally not subject to special legal requirements. With effect from year of assessment 2006, unutilised tax losses and unabsorbed capital allowances cannot be carried forward to subsequent years if there is a change of more than 50 per cent of shareholders of the company. However, the Ministry of Finance has clarified that this restriction is only applicable to dormant companies, where there is a change of more than 50 per cent of their direct shareholders. However, in structuring cross-border transactions, one should consider whether there might be any tax or cost saving advantage available under the applicable double taxation agreements between Malaysia and other countries, and the use of Labuan. To promote Labuan as an international business and financial centre, Labuan entities enjoy preferential tax rates and other tax incentives and exemptions. Income Tax Assessments: Tax authorities may raise income tax assessments on back years within six years from the end of a year of assessment (but note that the limitation period would be reduced to five years with effect from 1 January 2014). No time limit is imposed if the authorities allege fraud, wilful default or negligence by the taxpayer. Stamp Duty Transactional Tax: Stamp duty is a tax levied upon instruments (ie written documents) and is payable on ad valorem basis on, among others, instruments of transfer or conveyance. For instance, in an asset acquisition, the stamp duty imposed on a conveyance on sale of property is as follows: 1. One per cent on the first 100,000 ringgit; 2. Two per cent on the amount in excess of 100,000 ringgit but not exceeding 500,000 ringgit; and 3. Three per cent on any amount in excess of 500,000 ringgit. In a share acquisition, stamp duty is chargeable at the rate of 0.3 per cent on the purchase price paid or market value of the shares, whichever is higher. 21. How will the labour regulations in your jurisdiction and affect the new employment relationships? In an acquisition or takeover involving the sale of shares, there is no new employment relationship and consent is not required from the employees as the employment status of the employees remain unaffected by the transaction or change in shareholding. In an asset/business transaction, there is no unilateral or automatic transfer in law of the employment contracts. Consent of the employees will have to be obtained if it is intended for the employees to take up employment with the new owners of the business. In 2013, two new labour statutes came into force, namely the Minimum Retirement Age Act 2012 and the Minimum Wages Order The Minimum Retirement Age Act 2012 came into force on 1 July 2013 and sets a national retirement age for the private sector at 60 years. However, this statutory retirement age does not apply to employees of the public sector, foreign national employees, probationers, domestic servants and any fixed-term 153

12 LEXISNEXIS MERGERS & ACQUISITIONS LAW GUIDE 2015 contract employees that do not exceed 24 months in respect of the contract duration. The Minimum Wages Order 2012 came into force on 1 January 2013 and sets a national monthly minimum wage at 900 ringgit (for Peninsular Malaysia) and 800 ringgit (for the states of Sabah, Sarawak and the Federal Territory of Labuan). For employees who are employed at hourly rates, the minimum hourly rates have been set at RM4.33 and 3.85 ringgit respectively for the aforesaid categories. In addition, the Personal Data Protection Act 2010, a legislation which will regulate the processing of personal data in the private sector, including employment relationships, is expected to come to into force this year. The date of coming into force has not been set yet. There is a draft Companies Bill that is currently being put forth for public consultation. The draft Companies Bill sets out the new legal framework to replace the existing CA 1965 and may include provisions affecting aspects of mergers and acquisitions. 1 The Edge ( 2 The Star ( story.aspx?file=%2f2013%2f1%2f5%2f business%2f &sec=business, aspx?file=%2f2011%2f12%2f10%2fbusi ness%2f &sec=business) 3 business-news/ aia-to-lead-insuranceindustry-post-merger-with-ing.html) article/2012/10/newly-launched-hanwha-q-cellsbecomes-worlds-third-largest-solar-manufacturer 22. Are there any proposals for reforms to the laws and regulations governing mergers and acquisitions currently being considered? The latest significant reform to the regulations governing takeover in Malaysia is the introduction of the Malaysian Takeovers and Mergers Code 2010 on 15 December 2010 which replaced the old Malaysian Code on Takeovers and Mergers The announcement made by AEON CO Ltd on 1 November ( sites/renewal/common/images/en/pressroom/ imgsrc/121101r_1.pdf) 154

13 MALAYSIA ABOUT THE AUTHORS SWEE-KEE NG Partner, Corporate and Commercial Practice Group, Shearn Delamore & Co. E sweekeeng@shearndelamore.com W A 7th Floor, Wisma Hamzah-Kwong Hing No.1, Leboh Ampang, Kuala Lumpur, Malaysia T F MARHAINI NORDIN Partner, Corporate and Commercial Practice Group, Shearn Delamore & Co. E marhaini@shearndelamore.com W A 7th Floor, Wisma Hamzah-Kwong Hing No.1, Leboh Ampang, Kuala Lumpur, Malaysia T F