Research On Anti-takeover Measures Of Listed Companies On The Perspective Of Company Law

There are more and more mergers and acquisitions in China.In the recent wave of M&A,the takeover battle between Vanke and Baoneng Group is the highlight.Affected by the takeover battle between Vanke and Baoneng Group,many companies have modified charters to introduce anti-takeover measures.This leads to a disordered situation,since most of listed companies are strange to anti-takeover measures.Theoretically,the validity of many anti-takeover measures are still unclear.The existing laws of China are also ambiguous about anti-takeover measures.Another problem is that some anti-takeover measures are faced with improper institutional barriers.The managers of the target can do nothing when the hostile takeover comes.To solve the problems above,the author tries to study the anti-takeover measures by using the theory of Company Law and drawing lessons from America.This paper will clarify the extent of competence of managers to take anti-takeover measures and put forward ideas on the validity and improvement of specific anti-takeover measures.This paper consists of four parts.The first part introduces the American scholars' debate on positions of managers when companies face the takeover and demonstrates the theoretical basis and institutional space of the competence of listed companies to take anti-takeover measures.The second part make an anatomy of some classic anti-takeover measures by using the theory of Company Law.This part consists of four sections.The first section discusses why the competence that companies charters opt out Company Law should be restricted.Only in this way,can we understand why the anti-takeover measures which up the requirements of exercising rights are invalid.The second section discusses “crown jewel”?recapitalization and staggered board based on fiduciary duty of board.The author argues that “crown jewel” and recapitalization should be treated differently depending on conditions.As to staggered board,the board of the target will be in a very awkward position after a successful takeover,since they owe fiduciary duty to companies(shareholders).The third section discusses the theory of consideration of golden parachute.The golden parachute in China should be treated as a waste of company properties due to the lack of the consideration.So the golden parachute in China should be forbidden.The fourth section discusses the principle of cross-ownership provisions and whether the provisions should be applied to Pac-Man defense.Besides,the author also discusses the “race problem” caused by Pac-Man in America and points out that this problem won't happen in China.The third part discusses the dilemma of “White Knight” and stock repurchase in China and put forward solutions——establishing the authorized capital system and loosening the restraints of stock repurchase.The fourth part discusses the validity of poison pill and greenmail on the base of authorized capital system and loose requirements of stock repurchase.The author introduces the typical sorts and operating mechanism of poison pills.Moreover,after studying the problem of discrimination of shareholder,the problem of unilateral obligation,the problem of harshness,and the problem of transferring stocks,the author insists that poison pills should be invalid.As to greenmail,the author introduces the American scholars' debate on greenmail.Some scholars support greenmail,some scholars oppose greenmail,and some scholars hold neutral positions.The author is inclined to neutral positions and argues that the attitude of law towards to greenmail should not be monolithic.The competence whether to adopt greenmail should be entrusted to shareholder meetings.Shareholder meetings may define the situations in which greenmail is allowed in advance.