Section 984 Notice UK: Takeover Shareholder Rights
We're not a law firm — we help you find the right legal support. For advice on your situation, speak to a legal adviser or find a solicitor.
Part ofCompanies House Forms UK
When a takeover offer for a UK company reaches the acceptance threshold set out in the Companies Act 2006, the offeror takes on a specific duty toward shareholders who have not accepted the offer. Section 984(3) requires those shareholders to be told, in the prescribed way, about the rights available to them and the window in which those rights can be used.
This page walks through what a Section 984 notice is, why it matters, who has to send it, what the notice should cover, and the timing rules that apply. If you are running a takeover process or you have received a notice as a minority shareholder, the detail here should help you get your bearings before you take your next step. Accuracy and timing are central to this area of company law, so it is worth reading carefully.
What this document is
A Section 984 notice is a written communication sent by the offeror in a takeover to any shareholder who has not accepted the offer. Its purpose is to tell those shareholders that the squeeze-out or sell-out mechanics under the Companies Act 2006 have been triggered, and to set out what the shareholder can do about it.
The notice sits alongside the squeeze-out notices the offeror may serve under section 979, and the sell-out rights that minority shareholders may themselves rely on under section 983. In practical terms, the notice explains the rights the shareholder holds, the deadline for exercising them, and, if the original offer is still open, confirmation of that fact.
It has to be given in the manner prescribed by the Companies Act and associated regulations, which is why many offerors prepare it carefully with professional input. Getting the content and the timing right matters, because the rules protect minority shareholders who may otherwise find their holdings bought out without realising their options.
How to use this document
- Confirm the trigger point. Work out the exact moment the relevant threshold under section 979, 983(2), 983(3) or 983(4) was reached. The one-month clock for giving notice runs from that point, so pinning down the date is the foundation for everything that follows in the process.
- Identify every non-assenting shareholder. Pull together an accurate register of all shareholders who have not accepted the offer, including those holding shares of the class that is the subject of the takeover. Missing even one holder can undermine compliance and create problems later in the squeeze-out or sell-out process.
- Draft the notice content. The notice must describe the rights the shareholder can exercise under the relevant subsection and the period within which those rights can be used. If the offer remains open for acceptance when the notice is sent, the notice also needs to say so clearly to avoid confusing the recipient.
- Serve in the prescribed manner. The Companies Act and its supporting rules set out how the notice must be delivered. Typical routes include post to the shareholder's registered address, or electronic delivery where the company's articles and the shareholder's prior agreement allow it. Keep evidence of dispatch for each recipient.
- Track responses and deadlines. Once the notices have gone out, monitor incoming correspondence and the expiry of the rights period. Some shareholders may exercise their rights, others may accept the underlying offer late, and some will do nothing. A clear tracking system helps the offeror handle each outcome cleanly.
Common questions
If you're dealing with this kind of situation, speak to an experienced legal adviser who can walk you through it — from £89.
Common questions
Q Who has to send a Section 984 notice?
The duty sits with the offeror, meaning the person or entity that made the takeover offer for shares or securities in the target company. Once the statutory threshold has been reached under the relevant subsection of the Companies Act 2006, the offeror must send the notice to each shareholder who has not accepted the offer, within the one-month window set by section 984(3).
Q What is a non-assenting shareholder?
A non-assenting shareholder is a holder of shares in the target company who has not accepted the takeover offer. They may have actively rejected it, or simply not responded. Either way, they are entitled to know about the rights the Companies Act gives them, which is why the notice exists. These rights can include the ability to require the offeror to buy their shares on the offer terms.
Q How long does the offeror have to send the notice?
Section 984(3) gives the offeror one month from the trigger point specified in the relevant subsection. That trigger is usually the date the offeror hit the acceptance threshold that unlocks the squeeze-out or sell-out rights. Missing this window can have knock-on consequences, so offerors typically diarise the deadline as soon as the threshold is reached.
Q Does the notice need to mention the original offer?
If the notice is sent while the takeover offer is still open for acceptance, it has to state that the offer remains open. This protects shareholders who might otherwise assume the window had closed. If the offer has already closed by the time the notice goes out, that statement is not required, but the rights and deadlines still need to be spelled out.
Q Is a statutory declaration involved?
Statutory declarations can appear at other points in the takeover process, for example where the offeror needs to confirm certain matters in writing. The Section 984 notice itself is a separate communication to shareholders rather than a sworn declaration, but the wider squeeze-out and sell-out process often involves supporting documents that are signed and certified formally.
Q What happens if a shareholder ignores the notice?
If a shareholder does nothing within the period set out in the notice, the offeror may be able to proceed with the squeeze-out mechanism and acquire the shares compulsorily on the offer terms. The notice is there precisely so that shareholders cannot later say they were unaware. Shareholders who want to protect their position should act within the stated window.
Q Can the notice be sent electronically?
Electronic service can be possible where the statutory rules and the company's articles allow it, and where the shareholder has agreed to receive communications that way. Many offerors still use post as the default because it produces straightforward evidence of dispatch. Whatever route is used, the manner of service must match what the Companies Act and its regulations prescribe.
If you're dealing with this kind of situation, speak to an experienced legal adviser who can walk you through it — from £89.
Sources
This guide is based on primary UK law and official guidance.
- LegislationCompanies Act 2006, Section 984legislation.gov.uk
- LegislationCompanies Act 2006, Part 28 (Takeovers)legislation.gov.uk
- Guidance · Companies HouseCompanies House guidancegov.uk
Legal helpline
Unsure how Section 984 applies to your takeover?
The one-month deadline and the detail of what the notice must say leave little room for slip-ups, whether you are the offeror or a shareholder weighing your options. An experienced legal adviser can talk through the position based on what you describe and help you see what to focus on next.
- A plain-English walkthrough of Section 984 tailored to what you describe
- Practical perspective on the timing and content of the notice
- Clarity on what non-assenting shareholders can do in your specific situation
- Answers to your specific questions about the takeover process
Legal disclaimer
This article is for general information only. It is a tool to help you find your way — not legal advice, and not a substitute for speaking to a qualified adviser about your situation.