Germany to boost protection for shareholders in delistings

BERLIN, Sept 21 (Reuters) - Shareholders in companies that are delisted from the stock market will be entitled to cash compensation, according to new rules being drafted by German lawmakers, a person with knowledge of the matter said.

An earlier German court ruling made it easier for companies to delist from the stock market, with little obligation to compensate shareholders.

Under the new rules being discussed by lawmakers in Germany’s governing coalition, companies would be obliged to pay compensation to investors in the event of a delisting.

This scraps an earlier proposal that would have exempted shareholders in companies that were the subject of takeover offers. This plan was criticised by small investors who said it would have forced them to accept takeover bids.