Britain to look again at takeover "short-termism"
LONDON (Reuters) - Britain will look again into the issue of investor "short-termism" with a view to curbing the behaviour seen by some as damaging to companies in takeover battles, Business Secretary Vince Cable said on Sunday.
On Thursday the Takeover Panel published proposals to tighten rules in the wake of anger over a controversial 11.6 billion pounds takeover of Britain's Cadbury by U.S. rival Kraft Foods.
"The Takeover Panel didn't go for some of the more radical solutions like restricting the voting rights of short-term investors who have just come in to make a quick killing during a takeover bid," Cable told the Sunday Telegraph newspaper.
"We are going to have to look (at it). I want to take what the Takeover Panel has done -- and it is positive -- and probably go rather further," said Cable, a member of the Liberal Democrats, the junior coalition partners.
He said there was a need to look at the "whole issue of how you limit the influence of investors who just moved in over the takeover period."
The takeover of Cadbury sparked a furore in some quarters, partly due to hedge funds' role in ensuring the deal went through and after Kraft went back on a promise to keep a plant open.
"We want to consult properly, not just as they (the Takeover Panel) did predominantly amongst the people in the City who are in the takeover business but amongst business more widely."
Cable also expressed concern that executive pay had far outstripped shareholder performance during the past decade.
"It is a tricky issue whether we legislate to give shareholders more voting power," he was quoted as saying.
"I don't want to rush in to some crass change that has unintended consequences but we do need to acknowledge that there is a real problem here."
(Writing by Avril Ormsby; Editing by Matthew Jones)
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