From Wikipedia, the free encyclopedia

A dual-listed company or DLC is a corporate structure which involves two listed companies with different sets of shareholders sharing ownership of one set of operational businesses.

In a conventional takeover one business acquires the shares of another. However when a DLC is created, both companies continue to exist, and to have separate bodies of shareholders, but they agree to share all the risks and rewards of the ownership of all their operating businesses in a fixed proportion. This will be arranged through a complex set of contracts. Usually the two companies will share a single board of directors and have an integrated management structure. A DLC is somewhat like a joint venture, but the two parties share everything they own, not just a single project.

In virtually all cases the two companies are listed in different countries. There are often tax reasons for companies from different jurisdictions to choose DLC status, and once they have done so there can be major tax obstacles to cancelling the arrangement. Issues of national pride may sometimes also be involved; where both parties to a proposed merger or takeover are in a strong position and don't need to merge or accept a takeover, it can be easier to push it through if the country with the smaller business is not "losing" its corporation.

Some major dual-listed companies are listed below. One feature of note is that most leading dual listed companies are part British.

• BHP Billiton
• Brambles Industries
• Carnival Corporation & plc
• Fortis
• Investec Bank
• Reed Elsevier
• Rio Tinto Group
• Royal Dutch Shell - which cancelled its DLC status on 20 July 2005
• Unilever

A Dual listed company structure is effectively a merger between two companies in which they agree to combine their operation and cash flows and make similar dividend payments to shareholders in both companies, while retaining separate shareholder registries and identities.

Another definition of dual listing is where a company is listed on more than one stock exchange. Usually the shares on each exchange are all in the same company, and this is not the same as the definition of dual-listed company above. The term co-listing or Cross Listing is often used in this context. Generally such a company's primary listing is on a stock exchange in its country of incorporation, and its secondary listing(s) is on an exchange in another country. Co-listing is especially common for companies that started out in a small market but grew into a larger market. For example, numerous large Canadian companies are listed on the New York Stock Exchange or NASDAQ as well as the Toronto Stock Exchange. The term can also be used to refer to the listing of a company on more than one stock exchange in the same country: as an example, there are a handful of companies in the United States that are listed on both the New York Stock Exchange and the NASDAQ.