Takeovers Panel recommends tighter rules on amalgamations

The changes may restrict takeovers such as Transpacific Industries 2006 merger with Waste Management, which relied on section 13 of the Companies Act to succeed with just 75% support of shareholders. Section 13 has allowed M&A activity to skirt a requirement that companies covered by the Takeovers Code gain 90% shareholder support.

The recommendations would require changes to the code and the Companies Act, which the government is currently considering, according to a statement from the Takeovers Panel. A law change would be the culmination of a two year effort by the panel, which first sought the changes in August 2006.

By Jonathan Underhill

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