Reverse Cross Border Mergers – in a Brexit context

A recent High Court decision has confirmed that it is now possible to restructure European and UK operations by way of reverse merger of a UK parent company by absorption by a subsidiary based in another EU member state. This mechanism which derives from the EU cross border merger directive of limited liability companies (2005/56/EC) had not until this decision been permitted under English law.

In the context of Brexit (and pending what legislative changes are made following the invoking of article 50 to leave the EU) corporates will have a window of opportunity to restructure their operations by taking advantage of this mechanism (whilst still in force) to absorb UK companies into another EU jurisdiction or the other way round.

For further information about restructuring under the EU Cross Border Merger Regulations please contact Pia Dalziel.