Companies Act, 1973 (Act No. 61 of 1973)Chapter XVA: Regulation of Securities440A. Definitions |
| 1) | In this Chapter, unless the context otherwise indicates- |
"acquisition", in relation to securities of any company, means the acquisition of securities in such company by any means whatsoever, including purchase or subscription;
"acting in concert" means, subject to subsection (2)(a), acting in pursuance of an agreement, arrangement or understanding (whether formal or informal) between two or more persons pursuant to which they or any of them co-operate for the purposes of entering into or proposing an affected transaction;
"affected transaction" means any transaction (including a transaction which forms part of a series of transactions) or scheme, whatever form it may take, which-
| a) | taking into account any securities held before such transaction or scheme, has or will have the effect of- |
| i) | vesting control of any company (excluding a close corporation) in any person, or two or more persons acting in concert, in whom control did not vest prior to such transaction or scheme; or |
| ii) | any person, or two or more persons acting in concert, acquiring, or becoming the sole holder or holders of, all the securities, or all the securities of a particular class, of any company (excluding a close corporation); or |
| b) | involves the acquisition by any person, or two or more persons acting in concert, in whom control of any company (excluding a close corporation) vests on or after the date of commencement of section 1 (c) of the Companies Second Amendment Act, 1990, of further securities of that company in excess of the limits prescribed in the rules; or |
| c) | is a disposal as contemplated in section 228; |
"chairperson" means the chairperson of the panel designated in terms of section 440B(4) or (5);
"company" includes an external company and any other body corporate;
"control" means, subject to subsection (2)(b), a holding or aggregate holdings of shares or other securities in a company entitling the holder thereof to exercise, or cause to be exercised, directly or indirectly, the specified percentage or more of the voting rights at meetings of that company or any company controlled by it, irrespective of whether such holding or holdings confer de facto control;
"executive director" means the executive director or acting executive director of the panel appointed in terms of section 440B(11);
"offeree company" means any company the securities or part of the securities of which is or is to be the subject of any affected transaction or proposed affected transaction;
"offeror" means any person or two or more persons acting in concert who enter into or propose any affected transaction;
"panel" means the Securities Regulation Panel established by section 440B;
"rules" means the rules made or amended from time to time by the panel and approved by the Minister and published by him by notice in the Gazette;
"security" means any shares in the capital of a company and includes stock and debentures convertible into shares and any rights or interests in a company or in or in respect of any such shares, stock or debentures, and includes any 'financial instrument' as defined in the Financial Markets Control Act, 1989 (Act No. 55 of 1989);
"specified percentage" means the percentage, or different percentages in respect of different types of companies, prescribed in the rules for the purposes of determining control as defined in this section: Provided that the percentage shall in no case fall below 20 per cent of the issued securities of any class.
| 2) | For the purposes of subsection (1)- |
| a) | the following persons shall be deemed to be acting in concert with one another unless the contrary is established, namely-- |
| i) | a company, its holding company, subsidiaries, companies which are subsidiaries of its holding company and their subsidiaries, and companies of which such companies are associated companies, and for the purposes hereof ownership or control by a company of 20 per cent or more of the equity share capital of another company shall constitute the latter company as the former company's associate; |
| ii) | a company with- |
| aa) | any of its directors or holders of its securities who are beneficial owners as referred to in section 440G(1); |
| bb) | any company controlled by one or more of its directors; or |
| cc) | any trust of which any one or more of its directors is a beneficiary; |
| iii) | a company with any of its pension, provident or benefit funds; and |
| b) | a security which is convertible into a voting security shall, even before its conversion, be deemed to confer those voting rights which it would confer after conversion. |
| 3) | When the panel makes or amends rules, it shall, not less than one month before submitting the rules to the Minister for his approval, publish the text of the proposed rules in the Gazette, together with a statement of its intention to so submit such rules. |