Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Cash confirmation definition

What does Cash confirmation mean? In public takeovers, a cash confirmation is the statement that an independent third party has verified the bidder has sufficient cash to pay all shareholders if the cash offer (or any cash element) is fully accepted. Under the UK Takeover Code, this appears in the Rule 2.7 firm intention announcement and in the offer document (rules 2.7(d) and 24.8). It is normally given by the offeror’s financial adviser, who must be satisfied, after due enquiry, that resources are available, and assumes responsibility to the UK Takeover Panel. This is a Code-based requirement (not a statutory or case‑law definition)...

Cash confirmation and certainty of funds under the City Code on Takeovers and Mergers: rules, financing pre-conditions, certain funds period, and adviser responsibilities

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Practice notes

A core tenet of the City Code on Takeovers and Mergers (the Code) is that an offeror should declare a firm intention to make an offer only after thorough and responsible deliberation, and only where it has strong grounds to believe it can, and will continue to, implement the offer, including ensuring it can fulfil in full any cash consideration (the ‘certain funds’ or ‘certainty of funds’ concept).

Under rules 2.7(d) and 24.8, if an offer is made in cash or contains a cash element, both the announcement and the offer document must include confirmation from an appropriate third party—usually the offeror’s financial adviser—that resources are available to the offeror sufficient to satisfy full acceptance of the offer (a ‘cash confirmation’).

This Practice Note reviews the certain funds principle and the related cash confirmation obligations in the Code, and considers a range of issues for the offeror and its financial adviser when addressing these requirements and other matters relevant to bid financing arrangements, including financing conditions and pre-conditions, cash underpinnings and the treatment of new loan facilities, together with the documentation typically produced.

'Certain funds' requirement

The ‘certain funds’ or ‘certainty of funds’ principle...

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Web page updated on 21/05/2026

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