Mergers and acquisitions

Reflecting global trends, the NZX has seen limited growth in issuer numbers, with private markets being an increasingly competitive transactional alternative for vendors. While the NZX has significantly improved its issuance processes, the time, cost and residual risks associated with a public market IPO are greater compared to private market transactions. The ongoing reporting obligations continue to present challenges for issuers and the traditional benefit of being listed, namely access to capital, is increasingly well accommodated for by private equity and other fund investors.

The Government has progressed work to reform certain aspects of New Zealand’s capital markets. As part of these reforms, from 12 June 2025, prospective financial information (PFI) is no longer a mandatory requirement when preparing a product disclosure statement (PDS) for an IPO. Changes are also proposed to lift thresholds for climate-related disclosures with the intent to create a proportionate regime that does not create an undue burden for issuers. The reform aims to support New Zealand capital markets by removing barriers to listing, improve market competitiveness and to more closely align with Australia.

Phase 2 of the reforms will, among other things, review the PDS requirements in relation to equity and debt offers with the aim of lowering costs for issuers and enhancing usability for investors.

The PwC New Zealand M&A Quarterly Update reports on M&A activity in New Zealand and provides commentary on the global and local M&A outlook for the year ahead. Our Quarterly Update for Q2 of 2026 shows that 39 deals were announced in New Zealand during the second quarter of 2026, down from 43 deals in Q2 2025 and down from Q1 2026. While deal volumes softened, activity remained resilient. Overseas buyers accounted for almost half of all deals, highlighting continued international interest in New Zealand businesses, while increased private equity participation points to a broader and increasingly active investor market.¹

Overseas investors can acquire a New Zealand business or entity in a number of different ways. An acquisition will typically be structured according to regulatory and tax considerations, whether the parties prefer a share or asset sale, and whether the target entity is privately held or publicly listed.

Acquisitions of privately held companies are generally undertaken by agreement between the seller and the purchaser.

The acquisition or change of control of an entity that is listed on the NZX, or private entities with 50 or more shareholders and 50 or more share parcels and are at least ‘medium-sized’, must be structured as a takeover offer under the Takeovers Code or a Scheme of Arrangement under the Companies Act 1993 (see more on the takeovers regime below). The NZX Listing Rules will also apply to mergers and acquisitions involving NZX listed companies.

The New Zealand overseas investment regime regulates mergers and acquisitions that involve an overseas person (or overseas controlled entity) seeking to make an investment in significant business assets or sensitive land in New Zealand. This regime also seeks to manage risks to New Zealand’s national security and public order (see Overseas investment regulations section).

Before agreeing the commercial aspects of a transaction, investors should seek advice regarding any regulatory requirements and conditions that will apply. Entering into a transaction that is subject to the Takeovers Code or Overseas Investment Act 2005, for example, could have significant legal, reputational and financial implications if not managed correctly.

New Zealand company law is governed by the Companies Act 1993. Most major merger and acquisition transactions will require the approval of a company’s shareholders by a requisite majority.

For example, a New Zealand company must not enter into a “major transaction” (broadly, a transaction worth more than half the value of the company’s assets) unless the transaction is approved (or contingent on approval) by a special resolution of its shareholders, which ordinarily requires at least 75% of the shareholder votes to be in favour of the transaction.

New Zealand securities laws may apply if New Zealand financial products are being offered as consideration (see Capital markets section). There are a number of exclusions and exemptions under the Financial Markets Conduct Act that may apply.

Additional regulatory approvals may be required for a sale/disposal transaction depending on the nature of the industry that the target business is involved in. For example, insurance businesses may require approval of and/or notification to the Reserve Bank of New Zealand prior to a merger or acquisition transaction being completed.

Takeover activity is regulated by the Takeovers Code. The Takeovers Code restricts investors and their associates from undertaking certain transactions that impact their voting rights in a “code company”. 

The purpose of the Takeovers Code is to regulate the change of control of code companies so that all shareholders have equal opportunity to approve or participate in changes of control. 

A code company is any New Zealand company that is listed on the NZX or which has 50 or more shareholders and 50 or more share parcels and is at least medium-sized. A medium-sized company is, broadly, a company that, together with its subsidiaries, has at least NZ$30 million in assets or NZ$15 million in revenue in the most recent accounting period. The Takeovers Code is enforced by the New Zealand Takeovers Panel (an independent Crown entity). 

The transactions that are captured by the takeovers regime primarily involve those where a person (together with their “associates”) increases their ownership of voting rights in a code company above 20% (i.e., by initially crossing the 20% threshold or, if already above 20%, by increasing their ownership stake further). 

Once a person and their associates hold 20% or more of the voting rights in a ‘code company’, there are specific rules about how and if that person and their associates can increase their shareholding. In summary, a person can increase their shareholding above the 20% threshold by way of:

• A takeover offer to shareholders for some or all of the code company shares, for an offer price (shareholders are free to decide whether or not to accept the offer)
• Obtaining the approval of other shareholders
• Creeping acquisitions of up to 5% of the company’s shares over a 12-month period, if the person already holds between 50% and 90% of the voting rights in the code company
• An approved exemption

Once a person and their associates control 90% or more of the voting rights of a code company, they become a ‘dominant owner’ and may either complete a compulsory acquisition of the remainder of the voting rights or notify the remaining shareholders that they have the right to sell their shares to the dominant owner.

An alternative to conducting a takeover offer under the Takeovers Code is a scheme of arrangement that allows the change of control of a code company to be approved by the court under the Companies Act 1993. 

One of the key differences between a takeover offer and a scheme of arrangement is that, under a takeover offer, the offeror controls the process, offer price and offer terms (subject to compliance with the Takeovers Code). This means that a takeover offer can be used for a friendly or hostile takeover. A scheme of arrangement can be used to effect the same outcome as a takeover offer, but the target code company controls the process (with some involvement from the offeror and the shareholders). Accordingly, a scheme of arrangement can be an attractive option to effect a “friendly” takeover, potentially providing offerors greater likelihood of success once the target board approves the transaction.

A scheme of arrangement can also be used to achieve other outcomes involving the reconstruction of the company’s shares, assets or liabilities. 

Some of the key features of a scheme of arrangement include:

1. Certainty of outcome for the offeror (that is, if the scheme is not approved by the court, the offeror will not acquire any shares), although the court process can be time consuming and poses execution risk in its own right
2. The voting requirement to approve a scheme of arrangement is generally lower than voting thresholds required under the Takeovers Code
3. There is greater flexibility to incorporate terms into a scheme of arrangement that would not be permitted under a takeover offer

The Takeovers Panel retains a role with scheme of arrangement transactions including providing the court with a letter of no objection, which essentially provides the court comfort that scheme disclosures are “code equivalent” and that the Panel has considered whether all shareholders can vote together or whether there should be separate votes of different classes of shareholders.

While mergers and acquisitions can bring many benefits to the New Zealand economy through efficiency and innovation, some transactions have the potential to substantially lessen competition and create anti-competitive outcomes for consumers. The Commerce Act 1986 (Commerce Act) prohibits conduct that substantially lessens competition. The purpose of the Commerce Act is to promote competition in markets for the long-term benefit of consumers within Aotearoa New Zealand.

The Government commissioned a review of the Commerce Act in 2025, which identified complexity, cost and delays in supporting pro-competitive collaboration, limitations in enforcement, and gaps in the merger control framework. The Commerce (Promoting Competition and Other Matters) Amendment Bill was proposed as a result of that review, and seeks to introduce some of the most significant proposed reforms to the Commerce Act in recent years. The Economic Development, Science and Innovation Committee has recommended that the Bill be passed. The Bill is proceeding through its final parliamentary stages. 

At a high level, the proposed reforms would affect key areas of New Zealand competition law, including business acquisitions, pricing conduct by firms with substantial market power, pro-competitive collaboration between businesses, and the Commerce Commission’s enforcement tools. The Bill remains subject to the parliamentary process and the final form of any reforms may change.

Restrictive trade practices

The Commerce Act prohibits restrictive trade practices such as:

• Contracts and arrangements that substantially lessen competition in a market
• Cartel provisions including unauthorised price fixing, restricting of output or market allocation
• Misusing substantial market power by engaging in conduct that has the purpose or likely effect of substantially lessening competition in that market
• Resale price maintenance by a supplier of goods to ensure that their goods are not resold below a minimum price

The Bill (referred above) proposes changes affecting restrictive trade practices, including a new clearance pathway for certain pro-competitive collaborations, and a proposed predatory pricing provision for firms with substantial market power. 

Clearance and authorisation on business acquisitions

The Commerce Act prohibits a person from acquiring another business’ assets or shares (including by merger) if doing so will have the effect of substantially lessening competition in a market. Businesses proposing to acquire another business’ assets or shares may apply to the Commerce Commission for clearance or authorisation of the acquisition. It is not mandatory to apply for clearance or authorisation of a proposed acquisition, however this would provide parties with certainty to proceed if they are uncertain whether (or know) the proposed transaction would substantially lessen competition in a market. The Commerce Commission grants a clearance where it considers that the proposed acquisition will not be likely to substantially lessen competition in a New Zealand market. If the Commerce Commission grants a clearance in relation to a transaction, the parties are protected from future legal action under the Commerce Act provided the acquisition is made in accordance with the clearance and while the clearance is still in force. 

The Commerce Commission may grant an authorisation to permit an acquisition to go ahead even if it considers that the acquisition would result in a substantial lessening of competition, in circumstances where the acquisition would result in a benefit to the public that outweighs the competitive harm. Clearance and authorisation applications to the Commerce Commission must be submitted before the acquisition is unconditional.

Currently, filing for merger clearance in New Zealand is voluntary. However, the Bill (referred above) proposes an overhaul of the merger clearance process, including by giving the Commerce Commission additional tools to review non-notified transactions and “call in” transactions to require parties to seek clearance. The Bill also proposes to make amendments to the substantial lessening of competition test for mergers.

Breach of the Commerce Act

The Commerce Commission takes an active enforcement role and can investigate mergers or proposed mergers that may raise competition concerns and where the merging parties have not applied for, or do not intend to apply for, clearance or authorisation prior to the transaction completing (a non-notified merger). The Commerce Commission can seek interim relief or take enforcement action in the High Court.

Penalties for breaching the Commerce Act are substantial. An individual that breaches the restrictive trade and business acquisition provisions may be fined up to NZ$500,000. A company could be fined up to the greater of NZ$10 million, three times the commercial gain resulting from the breach, or 10% of the company’s group turnover for a specific period. An individual that commits an offence relating to cartel provisions may also face imprisonment for up to seven years.

The Bill proposes to strengthen the Commerce Commission’s enforcement powers, including through expanded injunction powers and additional court issued corrective action orders for restrictive trade practices.

The Commerce Commission aims to reach a decision on clearance and authorisation applications within 40 working days, however complex applications have been known to take several months. The Bill proposes more prescriptive decision timeframes and process changes for merger clearances and authorisations. We recommend initiating the clearance or authorisation process early to ensure that Commerce Commission approval does not interfere with your business acquisition.