Miliband calls for tougher takeover code

Pushing the protection of British companies and ultimately taxpayers, the labour leader has proposed a change to the Takeover Code to force long-term commitments upon investors.

Miliband's suggestions include raising the takeover threshold from 50% to 67% of shares in a company, and lowering the threshold for shareholding disclosure. Under the current provisions, shareholders with 1% or more of a company's shares must disclose ownership.

The latter links in with another clause Miliband is advocating, banning shareholders who have bought their stock after a takeover from voting on a sale of the company in question. In particular he criticised hedge funds' betting on the acquisition of Cadbury by US company Kraft Foods in February 2010.

The new UK Takeover Code came into effect in September 2011, and includes a strict 28-day bidding period after announcing a potential takeover.

 

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