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German govt obtains new powers to block hostile foreign takeovers in healthcare

German govt obtains new powers to block hostile foreign takeovers in healthcare

The government in Berlin gave itself new powers to veto hostile foreign takeover bids for German healthcare companies on Wednesday. The measure is designed to ensure a continuous supply of essential products during the coronavirus crisis.

The regulation, approved by the cabinet, will allow the government to block takeovers of makers of vaccines, precursor chemicals, medicines, protective equipment or medical machinery such as ventilators.

In the future, the government will be allowed to examine the security implications of a bid from outside the European Union as soon as the buyer holds more than 10 percent of the healthcare company’s shares. Now, the threshold is 25 percent.

The measure comes after the early stages of the coronavirus saw a run on materials believed crucial to combat Covid-19 including reported attempts by the US government to buy CureVac, a pharmaceutical start-up that was working to develop a vaccine against the disease, Reuters said.