The use of Dutch pre-wired back-end measures by foreign companies
Pre-wired back-end measures have become a well-established part of the Dutch public takeover practice. Recent precedents have demonstrated that such measures may also be available to listed companies incorporated in other jurisdictions. This trend report observes this interesting development and provides relevant considerations.
Pre-wired back-end measures in the Netherlands
Takeovers of Dutch listed companies are commonly structured as public bids. It has become market practice in the Netherlands to incorporate certain reorganizations that are implemented following completion of the bid. These ‘back-end measures’ are typically pre-wired, meaning that shareholder approval is obtained prior to completion of the bid from a neutral general meeting.
Recently, we have seen a number of transactions in which foreign companies were redomiciled in the Netherland upon completion of a successful bid. The availability of pre-wired back-end measures can be a relevant consideration in deciding upon such redomiciliation. Such measures may offer a path to 100% ownership even if these measures would not be available in the relevant jurisdiction of origin.
As a redomiciliation to the Netherlands may bring important advantages to international companies, including increased deal certainty, swift and easy post-merger integration and access to other advantages, we expect that more foreign listed companies will look to post-bid redomiciliation to the Netherlands and the implementation of pre-wired back-end measures.
Want to learn more? A trend report in which we share our thoughts on how this development may impact Dutch corporate governance standards, is freely available below.
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Bastiaan KempSenior associate Attorney at law
Bastiaan Kemp, attorney at law, is a member of the Litigation & Risk Management practice group in our Amsterdam office. He focuses on corporate law, including corporate governance, corporate litigation and arbitration.T: +31 20 578 50 46 M: +31 613 85 43 31 E: [email protected]
Philippe HezerAssociate Attorney at law
Philippe Hezer, attorney at law, is a member of the Litigation & Risk Management practice group. He specialises in corporate law, including corporate litigation, corporate governance and securities law.T: +31 20 578 59 26 M: +31 623 40 48 03 E: [email protected]