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The Future of Corporate Takeovers in Europe

The Future of Corporate Takeovers in Europe. ECGI Session at the Federation of European Securities Exchanges' 6th European Financial Markets Convention Brussels, 31 May 2002. Regulating Takeover Bids in Europe. Jaap Winter FESE Conference, 31 May 2002. 13th Directive’s Demise.

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The Future of Corporate Takeovers in Europe

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  1. The Future of Corporate Takeovers in Europe ECGI Session at the Federation of European Securities Exchanges' 6th European Financial Markets Convention Brussels, 31 May 2002

  2. Regulating Takeover Bids in Europe Jaap Winter FESE Conference, 31 May 2002

  3. 13th Directive’s Demise • Initial draft 1989, agreement 2000 • Germany backed out: no level playing field • Votes in EP blocked: 273 - 273 • Bolkestein: new proposal on basis of recommendations HLG • equitable price • squeeze-out • level playing field

  4. Level playing field • Three possible approaches: • leave it to the market, freedom of contract • permanent proportionality, one share one vote • middle ground: solution to allow take over bids to be successful across Europe

  5. Key recommendations • Disclosure of capital and control structures • Shareholder decision-making • Proportionality • First phase: EGM to authorise defence • Second phase: break-through if bidder after general bid has acquired 75% of risk-bearing capital

  6. Criticism • Freedom of contract/market force • Multiple voting rights • Concept of risk-bearing capital • No level playing field: pyramids untouched • Level playing field with the US

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