Head scratching

Huge hat tip to Ed Hammond and Arash Massoudi the M&A reporters over at the Financial Times for their scoop on CSR this morning. It's not easy landing these types of jackanories during August when most of the dealmaking community is away sunning themselves in the Med.

In case you missed it, here is a link to Hammond and Massoudi's piece: http://www.ft.com/cms/s/0/35629c52-2e5b-11e4-b330-00144feabdc0.html and the confirmation from CSR: http://www.investegate.co.uk/csr-plc--csr-/rns/csr-confirms-approach-from-microchip-technology/201408280947112254Q/

I was struck, though, by the fact that the offeror, Microchip Technology Inc - named in the press release by CSR - has so far not made a follow up statement to the London market on the Regulatory News Service.

Typically, this year those American bidders - such as Pfizer, AbbVie and Destination Maternity - that have sought to apply pressure on British companies when the story has leaked have followed up with their own formal announcements, laying out some of the gory detail of their indicative approaches.

So followers of these type of deal situations have been scratching their as to why Microchip has kept stum.

In part, this is because there seems to be a little bit of confusion as to whether Microchip is actually required under British Takeover Panel rules to make a statement about its future intentions for CSR.

Some observers presumed that if a target company publicly rejects an offer from an offeror (which CSR appears to have done), the bidder is required by the Takeover Panel to clarify its intentions.

However, my expert on the Takeover Panel code explained to me earlier today that there isn't a requirement on an offeror to make an announcement if the target company has already confirmed it has already received an approach from the offeror.

Instead, my expert says that the trend recently has been for American companies to voluntarily make formal announcements about their indicative offers from British companies because they were seeking to use a tactic in dealmaking called a "bear hug", whereby bidders try to get shareholders to put pressure on takeover targets by giving them extra detail on their indicative offers.

Confused? Well, I am slightly but it does look like, at the moment, that this takeover bid for CSR may play out a little differently to the recent aggressive tilts at British companies from American bidders.