The Hindu Business Line : ‘Dutch firms open to merger, acquisition activity’

Hyderabad, Dec. 19 Several Dutch firms are now open to mergers and acquisitions than ever before in sectors such as information technology, pharmaceuticals and some family held businesses in other sectors, according to Mr Robert V. Schipper, Executive Director of Netherlands Foreign Investment Agency (NFIA).

Tax sops

Attractive tax regime also makes M&A activity much easier and attractive thereby facilitating swift transition to make Netherlands a hub for the EU, he said.

Speaking to Business Line, Mr Schipper cited the acquisition that Tata Steel made of Corus, which had extremely profitable business in Netherlands, and said that lately IT companies, such as TCS and Suzlon, have made Netherlands their base.

Facilitating business

“As a facilitator for business, we have set up a centre in India and provide single point interface for investments in The Netherlands.

So far over 5,000 companies have had presence directly either setting up an office or coming in by acquiring a company,” he said.

Many family businesses in Netherlands, which have gone through couple of generations, are now at a point where they want to grow bigger.

Promoters of such companies are keen to either partner or merge with larger firms located abroad.

With tight market conditions and finances hard to come, valuations too are attractive now, Mr Schipper felt.

Conducive environment

The National Coordinator for Outbound Tax Advisory Services, Ernst & Young, Mr Nico Derksen, said “The tax structure presents a very conducive environment when it comes to investments in Netherlands and we believe it is fairly lenient when it comes to acquisitions.”

In fact, corporate tax rate is 25.5 per cent, which is well below the EU average.

In addition, the Dutch fiscal climate offers a wide tax treaty network and also 30 per cent tax break for highly qualified foreign employees, Mr Derksen said.

Referring to some of the companies who have made Netherlands their regional hub, Mr Schipper said “The Netherlands is a logistics hub handling nearly a third of regional business and well-connected.”

“Given the interest between the two countries, we expect more inbound business,” Mr Schipper felt.

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