Companies are regulated in terms of Section 118 of the Companies Act 71 of 2008 (“the Act”) and in conjunction with Regulation 91 of the Companies Regulations. Let’s unpack the relevant sections below:
What is a regulated company?
A regulated company according to S117(1)(i), 118(1) and (2) and Takeover Regulation 91, is either:
- A public company;
- A state-owned company; or
- A private company where more than 10% of its issued securities have been transferred within the previous 24 months (other than by transfer between related or interrelated persons), or a private company which is regarded as a regulated company in terms of its Memorandum of Incorporation (“MOI”).
- A transaction, or series of transactions, amounting to the disposal of all or the greater part of the assets or undertaking (business) of a regulated company (S 112 and 118(3));
- An amalgamation or merger involving at least one regulated company (S 113 and 118(3));
- A scheme of arrangement between a regulated company and its shareholders (S 114 and 118(3));
- The acquisition of, or announced intention to acquire, a beneficial interest in any voting securities of a regulated company (S122(1));
- The announced intention to acquire a beneficial interest in the remaining voting securities of a regulated company, not already held by a person or persons acting together;
- A mandatory offer (S123); or
- A compulsory acquisition (S124).
- An approved business rescue plan requires or contemplates the fundamental transaction;
- The transfer of more than 10% of the issued shares is due to a company buy-back; or
- The transfer is between related or interrelated persons (S 118(3) and 121 (b)(ii) and Takeover regulations 91 (2)(b) and 83).
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