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February 21, 2003
Patrick J. Scheil, Esq. Linklaters 10th Floor, Alexandria
House Chater Road Hong Kong China
Re: UBS AG, London Branch and J.P. Morgan Securities Limited File
No. TP 03-40
Dear Mr. Scheil:
In regard to your letter dated February 17, 2003, as supplemented by
conversations with the staff, our response is attached to the enclosed
photocopy of your correspondence. By doing this, we avoid having to recite
or summarize the facts set forth in your letter. Each defined term in this
letter, unless otherwise noted, has the same meaning as defined in your
letter.
Response:
You request an exemption from Rule 14e-5 under the Securities Exchange
Act of 1934 (Exchange Act) to permit UBS AG, London Branch and J.P. Morgan
Securities Limited to engage in market-making activities in the Ordinary
Shares of Dairy Farm International Holdings Limited (Company) during the
Offer. Rule 14e-5, among other things, prohibits a person making a cash
tender offer or exchange offer for any equity security from, directly or
indirectly, purchasing or making any arrangement to purchase the security
(or related securities) otherwise than pursuant to the offer from the time
the offer is publicly announced until its expiration, including any
extensions. Rule 14e-5 applies to the offeror's dealer managers,
stockbrokers, and financial advisers, and their affiliates, because these
entities act as the agent of the offeror to facilitate the offeror's
objectives.
On the basis of your written representations and the facts presented,
particularly in light of the facts that:
- The Company is a "foreign private issuer," as defined in Rule
3b-4(c) under the Exchange Act;
- During the Offer, UBS AG, London Branch and J.P. Morgan Securities
Limited will comply with the "Ethical Wall" requirements of the U.K.
City Code on Takeovers and Mergers (U.K. City Code) applicable to
"Exempt Market Makers;" and
- UBS AG, London Branch and J.P. Morgan Securities Limited maintain,
and during the Offer will continue to maintain, "Ethical Wall"
arrangements in accordance with rules of the Financial Services
Authority;
but without necessarily concurring in your analysis, the Commission, by
the Division of Market Regulation acting pursuant to delegated authority,
hereby grants an exemption from Rule 14e-5 to permit UBS AG, London Branch
and J.P. Morgan Securities Limited to make a market in the Ordinary Shares
during the Offer. This exemption is subject to the following
conditions:
- No purchases or arrangements to purchase Ordinary Shares, otherwise
than pursuant to the Offer, will be made directly or indirectly on
behalf of the Company;
- All purchases of Ordinary Shares by UBS AG, London Branch and J.P.
Morgan Securities Limited during the Offer will be effected in the
ordinary course of business and in compliance with any U.K. laws and
rules applicable to such purchases, and will not be undertaken for the
purpose of promoting the Offer, or for the purpose of creating actual,
or apparent, active trading in, maintaining, or affecting the price of
the Ordinary Shares;
- No purchases or arrangements to purchase Ordinary Shares, except as
part of the Offer, will be made in the United States;
- The Offer document will disclose that UBS AG, London Branch and J.P.
Morgan Securities Limited will be market makers for the Ordinary Shares
during the pendency of the Offer;
- The Offer Document will disclose prominently that, during the Offer,
all market-making transactions effected by UBS AG, London Branch and
J.P. Morgan Securities Limited will be made pursuant to the exemption
from Rule 14e-5 granted herein;
- UBS AG, London Branch and J.P. Morgan Securities Limited shall
disclose in the United States information regarding such purchases to
the extent such information is required to be made public in the United
Kingdom pursuant to applicable requirements in the U.K.;
- UBS AG, London Branch and J.P. Morgan Securities Limited will
provide to the Division of Market Regulation, upon request, a daily
time-sequenced schedule of all purchases of Ordinary Shares made by UBS
AG, London Branch and J.P. Morgan Securities Limited during the Offer,
on a transaction-by-transaction basis, including the size, broker (if
any), time of execution, and price of purchase;
- Upon the request of the Division of Market Regulation, UBS AG,
London Branch and J.P. Morgan Securities Limited shall transmit the
information as specified in paragraph 7 to the Division of Market
Regulation at its offices in Washington, D.C. within 30 days of its
request;
- UBS AG, London Branch and J.P. Morgan Securities Limited shall
retain all documents and other information produced pursuant to this
exemption for a period of not less than two years from the date of the
termination of the Offer;
- Representatives of UBS AG, London Branch and J.P. Morgan Securities
Limited shall be made available (in person at the office of the Division
of Market Regulation or by telephone) to respond to inquiries of the
Division of Market Regulation relating to their records; and
- Except as otherwise exempted herein, UBS AG, London Branch and J.P.
Morgan Securities Limited shall comply with Rule 14e-5 during the
Offer.
The foregoing exemption from Rule 14e-5 is based solely on your
representations and the facts presented, and is strictly limited to the
application of this rule to the proposed transactions. These transactions
should be discontinued, pending presentation of the facts for our
consideration, in the event that any material change occurs with respect
to any of those facts or representations. In addition, your attention is
directed to the anti-fraud and anti-manipulation provisions of the
Exchange Act, particularly Sections 10(b) and 14(e), and Rule 10b-5
thereunder. Responsibility for compliance with these and any other
applicable provisions of the federal securities laws must rest with the
Company, UBS AG, London Branch and J.P. Morgan Securities Limited. The
Division of Market Regulation expresses no view with respect to any other
questions that the proposed transactions may raise, including, but not
limited to, the adequacy of disclosure concerning, and the applicability
of any other federal or state laws to, the proposed transactions.
For the Commission, by the Division of Market Regulation, pursuant
to delegated authority,
James A. Brigagliano Assistant Director
Incoming LetterThe incoming
letter is attached in PDF
format.
http://www.sec.gov/divisions/marketreg/mr-noaction/linklaters022103.htm
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