Industry fears over EU threat to hostile bidding

Financial PR experts are raising fears over a new EU ruling on company takeovers which could render hostile bids impossible.

As PRWeek goes to press, MEPs are voting on whether or not to introduce new clauses drawn up by the legal affairs committee, which will ultimately give company boards power over shareholders on takeovers.

The changes to the directive are set out to allow a company's management to adopt defensive measures - or 'poison pills' - against hostile bids without consulting shareholders.

Europe has been waiting for landmark legislation on company takeovers for the last ten years, but industry sources fear the latest changes could wreck a decade's work.

'If they change the rules it will be a bad thing for financial PR and business as a whole,' said Cordiant's Business Communications International CEO Nick Miles.

'It would be terrible if this particular area of growth was closed down, and we can't see a reason in the current commercial scene why this should happen,' added Neil Mainland, chairman of the IPR City and Financial Group.

Leader, p8.