International Herald Tribune- The cabinet of Chancellor Angela Merkel of Germany on Wednesday approved new transparency rules for private equity and hedge funds, backing away from an earlier pledgeto reduce investment barriers.
The measures would become law next year if approved by Parliament.
The proposals “cover the wide spectrum of funds,” said a spokesman for the Finance Ministry. They focus on protecting companies that are takeover targets, and would oblige private equity and hedge funds to disclose how they finance their bids and to elaborate on their aims if they seek to raise stakes in companies beyond 10 percent, draft legislation showed. They also seek to restrict funds from acting in concert during takeovers and to curb hedge funds’ influence at shareholders’ meetings.
But the planned changes are not expected to be popular. While Merkel has courted funds to help finance company expansions, the plans will “catapult Germany further behind competitors in attracting foreign investment,” said Bernd Kreuter, head of alternative investments at Feri Institutional Advisors.
