Despite a shaky start, the euro makes its mark and fosters change

The euro celebrates its first birthday next weekend. It is still fragile, still wobbly and occasionally sprawls headlong at the feet of amused adults such as the British pound or the US dollar. But in its first year it has changed Europe's corporate landscape forever.

The new coin of the 11 realms is not even in circulation. All euro transactions are still either paper or electronic. Yet the continent's stock exchanges are all engaged in an increasingly tense battle for domination of what is fast emerging as a genuinely single market, where shares can be bought and sold on several different exchanges at once.

In the corporate world, the arrival of the single currency induces fear and enthusiasm in equal measure.

A year ago, companies might never have considered their counterparts across one of the continent's international borders as competition, let alone as a potential partner. Now they are caught up in a rush of hostile takeovers and friendly mergers.

In the new Europe, size matters and borders do not. Even from outside eurozone, takeover bids from the giants of telephony have begun to disturb the peace. If anything proves that a country's frontiers are defined by its currency and not by lines on political maps, it is the birth of the euro.

Admittedly, some of the biggest takeovers are still outside the eurozone, but even in Britain the same conclusion can be drawn. It is easier for two Scottish banks to offer rival bids for the London-based National Westminster Bank than for a Spanish or Italian bank to invade the pound's strongholds. Two countries, one currency has made business sense for many years on both sides of the Anglo-Scottish border.

And the days are long gone when a giant bank or telephone company could be regarded as a national champion, proof against foreign ownership.