• ITA Consob published discussion paper on Takeover Bids in ITA in period 2007-2019.

Overview

• Study is focused on impact of Takeover Bids Directive on the Italian capital market.
• Analysis of takeover and exchange bids launched in Italy between 2007 and 2019.
• Brief historical excursus on genesis and evolution of EU and Italian takeover bids laws.
• Study focuses on characteristics of subjects participating in bids, consultants assisting.
• On purposes for which takeover bids are launched in Italy with particular attention to delisting; premiums of bids, acceptance rates and market performance of target firms.
• Based on proprietary database of more than 20,000 data items, while covering all bids launched during cited period, it focuses particularly on share bids.

Key Findings

• Re share bids it emerges that less than half of bids on shares are related to changes in control and that only a narrow minority are classifiable as hostile takeovers.
• In most cases, bids provided for delisting program both as own purpose (voluntary bids to withdraw from listings promoted by controlling shareholder).
• Also as objective associated with change of control; data show recent growth trend in incidence of delisting increased from 50% to 90% over the last 5 years of analysis.
• These figures are interesting not only in terms of absolute value but also per increased average size of companies, propensity to delist occurred in non-bearish market phase.
• Average premium paid to shareholders is approximately 13%, with higher values in bids aimed at a business combination and voluntary bids.
• Returns, both absolute/relative to index, of shares offered show negative values on average i.e. excess return is -5.9% in following 12 months and -6.9% after 3 years.
• By differentiating results according to voluntary or mandatory nature of the bids.
• All ex-post return configurations are significantly lower in the case of mandatory bids.
• It does not claim to draw policy considerations/prospects for reform of current rules.
• But proposes analytical and objective framework that leaves available to scholars, regulators, market operators, evidence potentially suitable for future contributions.