earticle

영어

This paper analyzes the case for enhanced takeover defenses for East Asian companies in the modern context of global investors, open capital markets and disproportionate control structures. It surveys the current evolution in two families of takeover policy: (i) the American experience with poison pills and staggered boards, and the pill’s recent adoption in Japan; and (ii) the UK’s board passivity approach and its inclusion as an option in the European Union’s Directive on Takeover Bids. Given the incentives of controlling shareholders to seek greater takeover protection and the problems inherent to controlling minority corporate structures, a potentially attractive solution is proposed: an opt-in takeover law regime offering enhanced anti-takeover protections to companies that meet qualifying criteria. The opt-in regime would craft appropriate capital markets preconditions to company access to stronger takeover protections: eligibility would be based on an effective one-share, one-vote control structure and adequate disclosure. The enhanced takeover law would allow boards to reject an unsolicited bid, but remove their ability to use a staggered board to block a bid where the bidder wins a proxy contest. This opt-in proposal strives to achieve that elusive balance between the protection of deserving managers and the preservation of the shareholder franchise. Its aim is twofold: (i) to bypass the difficulties that the Delaware courts in the U.S. and the European Commission in its 13th Directive on Takeover Bids have experienced in wrestling with takeover defense policy, entrenched incumbents and cross-border reciprocity issues and (ii) to offer a strong incentive to controlling shareholders to restructure the extreme controlling-minority-shareholder capital structures that are a drag on the value of East Asian companies. Precise, transparent rules governing the market for corporate control would providecapital markets players a better roadmap to the costs and conditions of hostile acquisitions, potentially eliminating some inefficient acquisition efforts and the accompanying drain on management resources. If companies opt-in in significant numbers, the new regime may result in a net social benefit in the form of reducing the opportunity and benefits of bad-private-benefits extraction by minority controllers.