234 5 Equity and Shareholders’ Capital
States from requiring such disclosure.^488 After admission to trading, the obligation
to disclosure all steps in the IPO process was based on the Directive on market
abuse and the Commision Regulation implementing that Directive.
5.10.3 Internal Corporate Action
In the Ahlstrom case, the company took measures in anticipation of the IPO in
order to simplify the process of complying with legal requirements during the
IPO.
Resolutions in anticipation of the IPO. Before the IPO of Ahlstrom
Corporation, the general meeting approved the board’s proposal to distribute an
extra dividend for the previous financial year.^489 New investors would thus not
benefit from accumulated profits.
The articles of association were amended in various ways. As the company had
two classes of shares, the general meeting passed a resolution to combine them.
The company would thus have only one share class. Increased liquidity of the
company’s shares and the lack of a share class reserved for controlling
shareholders were likely to increase the price that investors were prepared to pay
for new shares. The existence of only one share class also simplified voting and
majority requirements.^490 A redemption clause was removed, as only freely trans-
ferable securities can be admitted to trading on a regulated market.^491 A mandatory
bid clause used as a takeover defence (poison pill) was amended (see section
18.4).
In addition, the general meeting approved a change of the terms of the
company’s stock option programmes.
Resolutions authorising the board to decide on the IPO. After such resolutions,
the general meeting could decide on the IPO. The general meeting authorised the
board to decide on core questions of the IPO such as increase in share capital,
issuing of shares, price payable for new shares, and withdrawal of pre-emption
rights. In addition, the general meeting authorised the board to decide on the
modalities of the IPO such as the detailed terms of the IPO.
Increase in share capital. At that time, each of the company’s shares had a
nominal value of €1.50.^492 Because of the shares having a nominal value, new
(^488) See, for example, recital 15 of Directive 2003/71/EC (Prospectus Directive): “The dis-
closure requirements of the present Directive do not prevent a Member State or a com-
petent authority or an exchange through its rule book to impose other particular re-
quirements in the context of admission to trading of securities on a regulated market
(notably regarding corporate governance). Such requirements may not directly or indi-
rectly restrict the drawing up, the content and the dissemination of a prospectus ap-
proved by a competent authority.”
(^489) Articles 15(1) and 15(2) of Directive 77/91/EEC (Second Company Law Directive).
(^490) Articles 3(e), 25(3), 31 and 38 of Directive 77/91/EEC (Second Company Law Direc-
tive).
(^491) Article 46 of Directive 2001/34/EC (Listing Directive).
(^492) Article 3(b) of Directive 77/91/EEC (Second Company Law Directive).