Abstract
We analyze the impact of a 75 pct. Break-Through rule on 1,035 European firms with dual class shares. In 3–5 pct. of the firms the controlling owners incur a direct loss of control, while in another 11–17 pct. of the firms, the controlling owners are likely to incur a loss of control. Firms in Germany, Italy and the Scandinavian countries are more likely to incur a loss of control. The restrictions that the Break-Through rule put on the ability of these firms to issue new shares to outsiders without changing the control structure are also estimated. We conclude that a significant number of firms with dual class shares in the European Union will be affected by a 75 pct. Break-Through rule.
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Bennedsen, M., Nielsen, K.M. The Impact of a Break-Through Rule on European Firms. European Journal of Law and Economics 17, 259–283 (2004). https://doi.org/10.1023/B:EJLE.0000028638.16309.4d
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DOI: https://doi.org/10.1023/B:EJLE.0000028638.16309.4d