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18 December 2020 / article

Trend Report: The use of Dutch anti-takeover defences by foreign companies

The Netherlands has traditionally embraced the use of anti-takeover measures by listed companies to ensure long-term value creation for stakeholders. We have prepared a trend report on the use of well-established Dutch anti-takeover measures involving foundations to help protect non-Dutch listed companies against hostile activity.

The use of Dutch foundations in anti-takeover measures

Dutch foundations are commonly used in the implementation of anti-takeover measures by Dutch listed companies. In such cases, the foundation serves as an (independent and autonomous) orphan entity holding shares in the listed entity or a subsidiary and exercises the rights associated to the shares. Litigation options to intervene in the foundation are limited under Dutch law. Such defensive measures amongst others allow for the listing securities without voting rights, the implementation of poison pill-like dilution mechanisms and/or granting special control rights (including (de facto) veto rights) to an independent foundation.

Although historically such anti-takeover measures have typically been implemented at the level of the listed holding company, these measures may also be used at subsidiary level. This is becoming more popular in recent years.

Recent case study

Suez: A case study on the use of Dutch foundations in anti-takeover measures by non-Dutch companies

This trend report explores a recent precedent in which Suez S.A., a leading French multinational with operations in water, energy, and waste management, implemented an anti-takeover measure involving a Dutch foundation at subsidiary level. The foundation was effectively granted a veto right to the transfer of certain activities outside of the Suez group. This anti-takeover measure was intended to preserve the sustainability of the Suez’ French water activities as operated by Suez Eau France within the Suez group.

Looking forward

Provided that applicable foreign corporate and securities law is duly observed, Dutch foundations with their strong autonomous corporate governance may help non-Dutch listed companies bring strong defenses, either at holding or subsidiary level, against hostile takeover attempts and deter hostile stake building.

Download the full trend report here or below.


Should you have any further questions on Dutch anti-takeover defences or do you feel that the described trend could be applicable to your specific situation, please do not hesitate to contact our corporate governance and litigation experts for tailor-made advice. 

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