GAINING CONTROL - THE WHITEWASH PROCEDURE
Tuesday 15 June 2004
If an individual or a group of people acting together intends to buy 30% or more of a plc they have to make an offer for all the other shares as well (see Gaining Control of the plc).
However this obligation can be waived by the remaining shareholders by a vote at a shareholder meeting. A majority vote is required of those attending the meeting, and the group wanting to buy 30%+ cannot vote as they have an interest in the outcome.
This vote of independent shareholders is known as a "whitewash" and is a way of gaining a large holding in a plc without having to spend the money on an outright bid for the whole.
We may well see the whitewash procedure used at Loftus Road as QPR's chief executive David Davies and at least one potential investor have referred to it as a way of gaining control of QPR Holdings plc.
Read
more:
Whitewash
guidance note from the Takeover Panel
::
BACK TO NEWS AND VIEWS MENU
::