Continuous Disclosure and Takeovers

There are lots of claims that companies don't comply with their continuous disclosure obligations (<- note: that's a link to a pdf file of ASX listing rules chapter 3), and especially so when takeover negotiations are in place. Here's a recent one that involves Flight Centre and its negotiations with Private Equity Partners.

THE ASX should make inquiries of Flight Centre to determine whether some directors knew several days before their controversial termination of the proposed joint venture with Pacific Equity Partners -- and ahead of receiving a report from the independent expert -- that the transaction was likely to collapse because it no longer had the support of the founding majority shareholders.

If so, that raises the question as to whether the company complied with the ASX continuous disclosure rule, which requires the immediate release of any information known to the company which a reasonable person would expect to have a material effect on the price or value of its securities.

By Bryan Frith in The Australian. I think that the breakdown of takeover negotiations is something that would be of interest to me as an investor. I'm not holding my breath waiting for action from ASIC.

UPDATE: Here's the Sydney Morning Herald's take on the same issue. Similar conclusions drawn.