Greed might be good

Author: | Published: 1 Aug 2007

These days it seems you can hardly open a newspaper and not see a headline about another Dutch company under siege. Questions are increasingly being asked in the Dutch business media and in corporate boardrooms: Do activist shareholders turn companies around or upside down? Are they destroyers of businesses or liberators of shareholder value? Are they shameless asset strippers or a blessing to the efficiency of the Dutch economy?

Shareholders in Dutch corporates have started to use their enhanced rights. They are no longer silent bystanders on the company's strategy, policy and anti-takeover measures. Shareholders are putting pressure on the boards of listed companies to abandon proposed acquisitions and focus on improving performance (as with VNU), to remove anti-takeover measures (CSM), to break up the activities of the company (ASMI, Stork and ABN Amro) or to reform governance structures (Royal Dutch/Shell).

Activist shareholders come in all shapes and sizes,...