Brexit: Increased scope for intervention in takeovers of UK businesses?

This paper discusses the implications of Brexit on the ability of the UK Government to intervene in cross-border mergers to protect domestic ‘strategic interests’ of the kind identified by the Prime Minister in her speech in July (in which she argued that “a proper industrial strategy wouldn’t automatically stop the sale of British firms to foreign ones, but it should be capable of stepping in to defend a sector that is as important as pharmaceuticals is to Britain”). In light of the recent consultation by the UK’s Department for Business, Energy and Industrial Strategy on the appropriate degree of UK Government intervention in foreign takeovers, the paper considers the scope for the UK Government to intervene on public interest grounds under the UK’s existing merger control regime, the constraints currently imposed on such intervention by EU laws and the possible implications of Brexit for acquirers of businesses operating in strategic sectors where both UK and EU merger control thresholds are met.

I. Introduction 1. Two days before her appointment as Prime Minister, Theresa May delivered a speech that has been widely received as a signal that the new Government will be more inclined to intervene in cross-border takeovers to protect UK national interests: “Because as we saw when Cadbury’s—that great Birmingham company—was bought by Kraft, or when AstraZeneca was almost sold to Pfizer, transient shareholders—who are mostly companies investing other people’s money—are not the only people with an interest when firms are sold or closed. Workers have a stake, local communities have a stake, and often the whole country has a stake. It is hard to think of an industry of greater strategic importance to Britain than its pharmaceutical industry, and AstraZeneca is one of the jewels in its

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  • Allen & Overy (London)


Dominic Long, Brexit: Increased scope for intervention in takeovers of UK businesses?, November 2016, Concurrences Nº 4-2016, Art. N° 81690,

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