Annual Report 2010 - CMVM

Corporate Governance Report 2010CORPORATE GOVERNANCE REPORTPursuant to the applicable provisions, namely article 245-A of the Securities Market Code and Regulation number 1/2010 of the SecuritiesMarket Commission (CMVM), TEIXEIRA DUARTE, S.A. (TD,SA) presents its Corporate Governance Report relative to the financial year of 2010,complying with all the requirements of the model attached to the abovementioned Regulation. Whenever deemed necessary and applicable,comments and considerations will be made on the procedures followed by the Company.The TEIXEIRA DUARTE Group has, for many years, been concerned with the subject known as Corporate Governance and has adopted practicesreflecting values that are currently safeguarded by the regulations on this matter, always being attentive to the development of national andinternational rules and recommendations.The Company complies with all its corporate obligations, namely as an issuer of shares listed for trading on regulated markets, and takeson due responsibility to find a balance between the different recommendations issued by the various entities and the Company's reality, itsstructure, history, markets and operating sectors.CONTEXT OF THIS 1ST REPORT OF TEIXEIRA DUARTE, S.A.:In order to contextualise this first Corporate Governance Report issued by TD,SA, it is necessary to recall the development of the Group's corporaterestructuring process, started on 17 December 2009, the main objectives of which were the essential concentration of TEIXEIRA DUARTE- Engenharia e Construções, S.A. (TD-EC) in its core business activity, that is, the exercise of the civil construction and public works industry, inall its areas and related activities, and its replacement by TD,SA as the leading listed company of the Group.Hence, and after the first prior concentration - at the end of 2009 - of 68.54% of the share capital of TD-EC in TD,SA, there was an publictakeover bid, in the form of a public exchange offer for the entirety of the remaining share capital of TD-EC, which was held between 19 Julyand 6 August 2010.Following this acquisition, TD,SA increased the share capital to EUR 406,360,199, becoming the owner of 96.75% of the share capital ofTD-EC.After the conclusion of the above operation, the shares of TD,SA were listed for trading on the regulated market of Euronext Lisbon as of 16August, and on 21 September 2010 the shares of TD-EC were excluded from trading on that market, following the application for the loss ofits status as a public company and the respective decisions by the CMVM and Euronext Lisbon on this matter.From then on, TD,SA replaced TD-EC as the leading listed company of the TEIXEIRA DUARTE Group.Subsequently and with a view to the acquisition of the remaining shares of TD-EC that had not been acquired under the prior concentrationand/or public exchange offer, on 26 November 2011 TD,SA presented an acquisition offer aimed at the total control of TD-EC, under the termsestablished in article 490 of the Commercial Companies Code, composed of the exchange of one TD,SA share for every TD-EC share delivered.Once this phase of the use of the potestative acquisition mechanism had finalised, TD,SA became the owner of 100% of the share capital of60