Definition
The EU Takeover Directive (Directive 2004/25/EC) establishes minimum standards for takeover bids across EU member states. Each member state implemented the directive into national law, with some discretion on specific provisions.
Core principles
- Equal treatment of all holders of the same class
- Mandatory bid when a person crosses a defined control threshold (typically 30%)
- No-frustration of bids by target boards without shareholder approval
- Information rights for employees and the SEC-equivalent regulator
- Squeeze-out / sell-out rights at 90%+ ownership
Why it matters
The directive shapes the operational character of EU public M&A. Compared to the U.S., EU takeover regimes:
- Are more rules-driven and predictable
- Place stronger constraints on defensive tactics by target boards
- Use higher mandatory-bid thresholds (typically 30%) instead of granular 5% disclosure
- Apply stricter timetables and equal-treatment standards
Distinction
The U.S. has no equivalent unified federal regime; takeover law is a mix of federal Williams Act + state corporate law.