Tidy takeovers prevail as M&A activity picks up

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Mergers and acquisitions may have been relatively thin on the ground over the last 18 months, but an increasing number are being structured through tax efficient ‘schemes of arrangement’.

According to figures from City law firm Trowers & Hamlins, 37% of all takeovers of UK listed companies in the last year (to December 2009) were structured through tax efficient “schemes of arrangement” compared to just 24% of all takeovers in the previous year.

Where a takeover takes place through a scheme of arrangement with a reduction of capital, the bidder does not have to pay HMRC stamp duty at 0.5% on the overall purchase price of the company.

In such a scheme of arrangement shares in the target company are (following court approval) cancelled and re-issued to the b...

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About Gina Dyer

About Gina Dyer

I've been a journalist for four years, writing on a wide variety of topics from business and finance to travel, culture and celebrities. I began my career as an editorial assistant for Palladian Publications, a B2B publisher specialising in technical magazines for professionals in primary industries. I later moved into consumer magazines as a staff writer for French Magazine, a monthly travel publication aimed at Francophiles, and was part of the launch team for The Traveller in France, a quarterly magazine produced for the French tourist board. I was also a regular contributor to online travel portal Homesworldwide.co.uk, and later worked with customer publishers Future Plus as a freelance production editor, before joining Sift Media in January 2009. I am currently Deputy Editor of AccountingWEB.co.uk.

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