DSM LOYALTY DIVIDEND OKAYED

[BIZ: Amsterdam, December 14]
The Dutch Hoge Raad, the Supreme Court of the Netherlands, has overturned an earlier decision by the Business Division of the Court in Amsterdam, taken on March 29 this year. This decision held that DSM’s loyalty dividend program, which was established to reward shareholders, who held on to their shares, was in conflict with the law; because shareholders would not be treated equally.

The underlying idea of the loyalty dividend was to bind shareholders more closely to the company so that their shares would be less likely to fall prey to corporate raiders in the form of hedge funds and private equities. DSM’s proposal was that shareholders who kept their DSM shares for a period of at least three financial years would be entitled to a non-recurring loyalty dividend amounting to 30% of the average annual dividend paid on ordinary shares in the three previous years, in addition to the regular dividend.
http://www.rechtspraak.nl/Gerechten/HogeRaad/Actualiteiten/