In the Matter of Emis Group Plc

The court may approve a modification to a scheme of arrangement extending its longstop date before the existing date expires. Where regulatory investigations delay sanction and implementation, prior approval is preferable to allowing the scheme to lapse and seeking retrospective relief. The court may approve the extension without determining whether a further shareholder meeting is required. Any later sanction hearing remains a separate stage at which the court must scrutinise whether it is fair to proceed.

Emis Group Plc sought approval to extend the longstop date in a scheme enabling Bordeaux UK Holdings II Limited to acquire the Company. Scheme shareholders had approved the scheme at a court-convened meeting, but the Competition and Markets Authority had referred the acquisition for a phase 2 investigation. The existing longstop date of 30 June 2023 was therefore proposed to be extended to 30 June 2024.

The application was made as a precaution under the scheme terms. The Company had not decided whether to proceed without another shareholder meeting or to convene one. The issue was whether the court should approve the proposed extension before the scheme lapsed.

1. Application granted. The court approved the extension of the scheme’s longstop date from 30 June 2023 to 30 June 2024.
2. The scheme document contemplated that the longstop date might be extended by agreement between the Company and Bidco, with Takeover Panel consent and, if required, court approval. It also permitted modifications under clause 7. The court considered it appropriate to approve the extension before the scheme lapsed.
3. The delay resulted from the outstanding regulatory process, particularly the CMA’s phase 2 investigation. The Company’s board continued to consider the scheme to be in the interests of the Company and its shareholders, and no shareholder objection had been received.
4. The court did not determine whether a further shareholder meeting would be required before the sanction hearing. That remained for the Company to decide in light of developments in the regulatory investigation.
5. The approval was not the sanction of the scheme. At the later sanction hearing, the court would scrutinise whether it was fair to proceed on the proposed terms.