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Difference between a merger and takeover
A merger is when a group of co-operatives decide to become one co-operative:
- made up of the members, assets, liabilities and undertakings of the co-operatives that want to merge
- with a new name and new rules.
A takeover (called a ‘transfer of engagements’ in the Co-operatives National Law) is when one co-operative takes over one or more co-operatives, with the resulting body:
- made up of the members, assets, liabilities and undertakings of all the co-operatives involved in the takeover
- using the existing name and rules of the co-operative taking over the other(s).
A takeover can also be partial - for example, if only some of the assets, liabilities and undertakings are transferred to another co-operative.
Disclosure statement for merger or takeover
In either of the above scenarios you must prepare, for each co-operative, a disclosure statement showing:
- whether a merger or takeover will occur, and the reasons for it
- in a takeover, whether one co-operative will be entirely taken over by the other co-operative, or if part of it will continue to operate independently
- financial statements prepared within the last six months that indicate the financial position of your co-operative
- any compensation or payment to be made to any member of your co-operative as a result of the merger or takeover
- any material interest your co-operative officers have in the merger or takeover.
Download a copy of our Example disclosure statement for merger or transfer of engagements of co-operatives (Word, 42KB).
Or, seek legal advice on drafting your own disclosure statement.
Lodge an application to merge or take over
Complete either the:
Lodgement details are on the forms.
If you want a new name, new rules or both, you must give the proposed name as well as two alternative names.
Sign and lodge the relevant forms with the Registrar and attach them to your application. These may include:
- the blank parts of your co-operative's model rules you must complete
- any changes to the rules, and the reason for each change
- your co-operative's disclosure statement
- the application fee.
For more information on application fees, view Fees and forms.
After you lodge an application
The Registrar will either:
- send you a form approving the merger or takeover and if applicable, your new co-operative’s name and rules, or
- ask you to change what you want to do
- request more information.
All the co-operatives involved in the merger or takeover must have special resolutions passed by their members - that is, three-quarters of the votes received are in favour of the merger or takeover. You can notify your members of a special resolution by special postal ballot. For more information, view Holding a postal ballot - Wind up a co-operative.
If you have a good reason not to hold a postal ballot; for example, holding a special postal ballot would be difficult or impractical, you can apply for an exemption by emailing your reasons to the Registrar via email@example.com.
Within 28 days of completing the resolution process, the co-operatives involved in the merger or takeover must authorise a person to liaise with the Registrar on the co-operatives’ behalf while the new co-operative is being registered. They must complete and submit an Application to approve merger of co-operatives (Word, 176KB), or Application to approve transfer of engagements (Word, 127KB). Lodgement details are on the forms.
The Registrar will:
- register the new co-operative
- on the same day, deregister all of the co-operatives that are ceasing as a result of the merger or takeover
- send a new registration certificate.
The new rules come into effect on the day the new co-operative is registered.