Irish takeover panel snubs its own government

FT Alphaville pointed me to this fascinating ruling by the Irish Takeover Panel. The panel says that when the government is a shareholder of the target company, any concessions made by the acquirer to the government in the area of public policy (lower consumer prices) is tantamount to giving one shareholder (the government) more favourable terms than the other shareholders.

I am not a lawyer, but I think this is a complete game changer in takeover law. Any agreement with the promoters that gives them any kind of favourable terms even if it is not at all in their capacity as shareholders seems to be forbidden by this ruling. I blogged about this kind of issue nearly three years ago, but the Irish solution goes beyong anything that I imagined at that time.

Posted at 4:33 pm IST on Sun, 14 Dec 2008         permanent link

Categories: corporate governance, equity markets, regulation

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