Multiple votes and DDL Capitals observed special by the Stock Exchange
Brembo’s decision to transfer its registered office to Amsterdam comes at a time of intense discussions about competitiveness of the Italian capital market. The leader of the braking systems explained that it will come with the move to Holland enhanced voting rights under Dutch law for the benefit of all shareholders, with the aim of encouraging shareholder stability and external growth. However, he specified that the tax office will remain in Italy and the shares will remain listed on Euronext Milan.
The Stock Exchange did not take well Brembo’s Dutch breakthrough which closed the session down 6% at 13.5 euros, also because it fears that the move is linked to an operation in Pirelli. In fact, Breembo already has 6% of Pirelli in its portfolio which, after the Golden Power imposed by the government, could change its main shareholder. And with the exit of the Chinese, operators are betting on a greater commitment from Brembo.
In Italy there is waiting for the DDL Capitali
I systems that provide for multiple voting rights I am now widespread in the legal systems of the Member States of the European Union and the proposal for a European directive, currently under negotiation (in the so-called Listing Act), also goes in this direction, aimed at allowing the adoption of such systems by companies wishing to access growth markets for Sme. The DDL Capital the government study estimates to increase the multiplication factor to 10, but only for companies that will soon be listed.
After the approval of the assembly, Brembo would become the FTSE MIB company week with an ISIN starting with NL (the acronym of the Netherlands, joining Campari, Iveco, Stellantis, Ferrari, CNH Industrial, STM.
Eventually the Bombassei family will have 77% of the voting rights
The Equita analysts point out that the increased voting right for long-term shareholders, currently already in force in Italy with double voting for those who hold the shares for 2 years (in fact the Bombassei family holds 53.5% of the capital and 69.7% of the votes) will be further strengthened as follows: 1 more vote for each year in which one is registered in the Loyalty register up to 9 additional votes per share; 1 additional vote for those who are already registered in the register or who will be registered by the date of the withdrawal period, effective from the day on which the transfer is finalised. In practice, according to analysts’ calculations, at the end of the process, the Bombassei family could have 77% of the voting rights (assuming zero withdrawal and no one gets the additional vote).
Paolo Savona wants to protect minorities
However, not everyone is convinced that increasing the voting rights attached to shares with multiple votes is a decision without negative consequences. Just yesterday, in a hearing at the Finance and Treasury Commission on the “Competitiveness of capital” bill, Paul Savona he said that CONSOB shares the opportunity for a reform of the regulations in force on the matter, also proceeding towards greater convergence at the European level, while reiterating “the importance of some safeguards for the protection of minorities“.
According to Savona, it is “necessary to note that the provision of measures in favor of capital increases, in conjunction with the aforementioned proposal to extend the voting rights associated with shares with multiple votes from three to ten, amplifies the risk of limiting the voice rights of minoritiesimplying the substantial ability of the majority shareholder, who is also in possession of shares with multiple votes, to have a resolution of the shareholders’ meeting approve a capital increase exclusively with his or her favorable vote”.
Assonime aims to strengthen multiple voting
A few days earlier a different message had arrived from Assonymous (Association for Italian joint-stock companies), which – again during a hearing in the commission – proposed to integrate some measures envisaged by the provision in order to make its impact more effective. In particular, he suggested that “extend the reinforcement envisaged by the bill for multiple votesusable only by unlisted companies, even to the increased vote, which can be used by already listed companies, providing for both the possibility of assigning up to ten votes per share”. This “would also allow already listed Italian companies to take advantage of a tool, available in other jurisdictions, which allows for the implementation of M&A transactions essential for growth and the creation of value in the long term, maintaining continuity of direction and management of the company,” said the general manager Stephen Firpo.