IPO's and valuations, page-150

To quote from a recent ASX announcement (28 February).

"Listing Rule 3.1 [..] requires a listed entity to give ASX immediately any information concerning it that a reasonable person would expect to have a material effect on the price or value of the entity's securities".

But...

"Listing Rule 3.1A [..] sets out exceptions from the requirements to make immediate disclosure, provided that each of the following are satisfied.

3.1A Listing rule 3.1 does not apply to particular information while each of the following is satisfied in relation to the information:

3.1A.1 One or more of the following applies:
- It would be a breach of a law to disclose the information;
- The information concerns an incomplete proposal or negotiation;
- The information comprises matters of supposition or is insufficiently definite to warrant disclosure;
- The information is generated for the internal management purposes of the entity; or
- The information is a trade secret; and

3.1A.2 The information is confidential and ASX has not formed the view that the information has ceased to be confidential; and

3.1A.3 A reasonable person would not expect the information to be disclosed. "


So the question becomes - Do you think "talks" (between CYP and whoever) constitute "information concerning CYP that a reasonable person would expect to have a material effect on the (share) price" - if you think the answer is yes then, if you were a CYP director, only satisfying all three of the exemptions, that is, one from 3.1A.1, and both of 3.1A.2 and 3.1A.3 removes the obligation to immediately disclose.

Personally I reckon "talks" could be considered "information [that] concerns [only] incomplete proposals or negotiations" in a wide variety of cases - so long as those talks did not produce agreements or commitment and so long as those talks were not leaked or accidentally disclosed (voiding the 3.1A.2 exemption condition which needs to be satisified) then 3.1 is effectively avoided.

Say CYP met with Celularity and Fujifilm together and with another party that brought them all together and then one of the four accidentally made their four party combined meeting known. Confidentiality has probably already been compromised in such a scenario, (by the fourth party letting the fact of their meeting become known) and so, in such a scenario the directors might already have an obligation to immediately inform the ASX.

Indeed it is possible that such a four party combined meeting could not lawfully take place (in my opinion) because even arranging it would be harmful to the interests of some shareholders. The mere possibility that Celularity and Fujifilm (or any two suitors) might collude to constrain the share price in advance of a takeover offer might make just such a hypothetical meeting with CYP directors (and multiple suitors) impossible to legally hold.

I don't know this to be true, but I suspect it to be close enough to being true that CYP directors wouldn't put themselves in that situation. All my opinion.