CREST and Euroclear announced today that the merger control authorities in the United Kingdom had cleared the takeover of the UK CSD by the Brussels-based ICSD. Yesterday the UK Secretary of State for Trade and Industry decided not to refer the merger to the Competition Commission in the UK, in accordance with the recommendation of the Director General of Fair Trading. The merger, which received a Soviet scale endorsement from shareholder s at the Extraordinary General Meetings held on 14 and 16 August , is expected to become effective later this month, following the sanctioning of the scheme of arrangement by the UK High Court.
High Court approval was necessary because the merger is being effected through a scheme of arrangement under section 425 of the Companies Act 1985. The scheme required approval of CRESTCo shareholders by the passing of a resolution at the High Court meeting. This resolution had to be approved by a majority in number of the holders of CRESTCo shares present and voting, either in person or proxy, representing not less than 75 per cent in value of the CRESTCo shares held by such holders. In addition, the merger involved the passing of a special resolution at an EGM of CRESTCo. Both the Court meeting and the EGM were held on 16 August 2002. The scheme was also conditional on Euroclear plc shareholders and Euroclear Bank shareholders approving a number of changes to the Articles of Association of Euroclear plc and Euroclear Bank, respectively, to reflect the proposed corporate governance regime to be adopted by the New Group. Shareholders approved these changes at EGMs held on 14 and 16 August. The necessary shareholder approvals have now been given.