Vince Cable plots to fine raiders for broken takeover vows
Ministers could force companies to pay a fine if they fail to deliver on promises made during takeover bids, under plans unveiled by Vince Cable yesterday.
The business secretary said ministers are keen to ensure there is no “wriggle room” for investors to back out of commitments they make in order to strike a deal for British companies.
The promise comes in the wake of the failed bid by pharmaceutical giant Pfizer, for British company Astrazeneca.
“There will be cases where there are vital national interests, in this case large-scale investment of research and development,” he said. “The question is how you protect it. What the government did then [during the proposed Pfizer takeover] was to engage in negotiations to seek assurances. Where we now have to strengthen that is to make sure that with any commitments made there is no wriggle room.”
The news was met with dismay by the business community, which is nervous of increased government intervention in takeover bids. A spokesman for the Institute of Directors (IoD) said: “The IoD sees no case for an extension of the public interest test for takeovers. The UK attracts so much inward investment because it is an open economy, and we do not want to see this change. Every individual extension to the public interest test may seem sensible as it happens, but the risk is we end up as an island fortress, cut off from the global economy.”