world,’ says Mark Rebergen, resident partner of De
Brauw ‘s New York office. ‘So it boasts a very business-
friendly culture. That’s why many international compa-
nies have chosen the Netherlands for their global or
European headquarters.’
The business friendly culture is shored up by a pro-
gressive tax system. While the country’s 25.5% corpo-
rate tax may not be as low as the headline 12.5% rate
in Ireland, it certainly compares well to the 28% rate of
the UK, and the 33% rate in France, but it’s not just the
rate itself that is attractive.
‘The Netherlands maintains a very good network of
tax treaties and boasts a favourable regime for tax-plan-
ning,’ Jan Erik Janssen, competition and regulatory
expert at Amsterdam-based Stek, says. ‘There is a con-
stant worry that those will be altered but it hasn’t
changed yet and it has withstood the financial crisis
pretty well.’
The looming EU changes are a potential cloud but
until concrete plans emerge the country’s tax status
looks pretty solid. The regime is long-established and
well-protected; it has made the Netherlands home to
the seventh largest financial industry in the world, so
the consensus is that the government is committed to
ring-fence tax incentives. Stek, a boutique corporate
and litigation firm, is certainly content; the firm will
show more than double digit growth for the past finan-
cial year, and that is not bravado. The Netherlands has
picked itself up and is already starting to brush off the
effects of the credit crunch.
GREEN SHOOTS
According to Statistic Netherlands, the forth quarter of
2010 saw growth climb to a very healthy 2.5% compared with the same quarter in 2009. Law firms are predictably upbeat.
‘Since summer last year, the signs have been that the
private equity market is picking up steam,’ says Gaike
Dalenoord, corporate specialist at Dutch heavyweight
NautaDutilh. ‘January/February was a continuation of
that uptick and there is also lots in the pipeline.’ In April,
NautaDutilh advised international pharmaceutical
provider Mediq on the takeover of medical device com-
pany Pannen Beheer Groep (PBG) from Dutch private
equity firm, Mentha Capital. However, Dalenoord adds:
‘There has been a bit of a slowdown over the past
month but is that macroeconomic or is it a coinci-
dence? We think it is a coincidence.’
It does seem to be a coincidence. Private equity
activity is seen as the bellweather of the Dutch market
and looking at figures released from the Dutch Private
Equity and Venture Capital Association (NVP) it is pointing in the right direction. Private equity firms invested
approximately b2bn in the Dutch economy during
2010 and Dutch private equity firms raised b1.3bn in
new funds, representing a 160% rise on the b500m
raised the year before. It is an important sector of economy; at the end of 2010, Dutch reliance on private
equity was substantial, with companies financed by private equity accounting for more than 15% of the
Netherlands’ GDP.
As more and more international
corporates invest in the Netherlands
on the back of its business-friendly tax
regime, it must be reassuring to
know that it is in safe hands on the
legal side too.
‘Private equity houses are taking the opportunities
afforded by the credit crunch,’ says Heleen Kersten,
managing partner at Dutch-based international firm,
Stibbe. ‘This year it is easier to valuate companies. Also,
strategic investors are looking again at buying acquisitions, which is interesting for PE firms looking to sell.’
Last year, Kersten advised Tommy Hilfiger Group and
Apax Partners on the acquisition of Tommy Hilfiger by
Phillips-van Heusen, but says the PE market was relatively sluggish until the summer. The first quarter of
2011 has been more active again and there are some
significant trends to observe. ‘It’s not just the Dutch corporate activity that is driving the market, we’re seeing
much more interest from Asia,’ adds Kersten.
In a highlight example of this growing trend, Kersten
was recently involved in a high profile case where a
small Chinese company attempted to acquire Dutch
cable maker Draka Holding in a $1.3bn bid. The bid
eventually collapsed, but it is acknowledged to be a sign
of the times. Both Stibbe and NautaDutilh are among
the firms that have set up specialist Asia practices to
manage the growing interest.
‘It’s more for inbound work rather than outbound,’
says Michaela Ulrici, chair of the NautaDutilh board.
‘As long as GDP growth in Asia remains, outbound
investment will concentrate on specific technologies or
distribution. Once GDP drops then those countries may
look abroad for investment.’
