December 12, 2018
by admin
in News
On 7 December 2018, NLD EA issued bill on cooling-off in hostile takeovers.
- Bill to allow board of a Dutch listed company to invoke 250 day cooling off period.
- Background
- Follows political debate over several hostile takeover attempts, e.g. Akzo-Nobel.
- Government response was published in letter dated May. 20, 2017, with 4 options.
- Shareholders may pressure management to change strategy, e.g. firm demerger.
- Cooling-off period of maximum of 250 days gives more time and peace to decide.
- In cases of demands for directors dismissal, or if hostile takeover bid announced.
- Board would use the period to explore alternatives, in dialogue with stakeholders.
- Measure stems from coalition agreement, has been agreed by council of ministers.
- Details
- Bill is to amend book 2 of the civil code, inserting art 114b and amending art 129.
- Subject to certain necessary exceptions, during the cooling-off, reflection, period, a director, or supervisory director, can not be appointed, suspended, terminated.
- Shareholders remain entitled to request dismissal of a director is put on agenda.
- To prevent reflection period from being used improperly, bill contains guarantees.
- If wish to make use of cooling-off period, need approval of the supervisory board.
- Board may decide to terminate cooling-off period if it considers it is that it has a sufficient view of the effects on stakeholders and consideration of these interests.
- The supervisory board must agree to any early termination of cooling-off period.
- Shareholders with interest of at least 3% may ask court to end cooling-off period.
- Bill also makes explicit, primacy of the management with respect to the strategy.
- Effectiveness
- Consultation open for comments to 7 February 2019.
