Corporate and capital markets laws in India have allowed foreign companies to list in India in the form of Indian depository receipts (IDRs). While this facility was allowed with much fanfare, it has been accessed so far by only one company, i.e. Standard Chartered Bank. However, more companies might likely follow in the future. A new paper titled “Reverse Cross-Listings — The Coming Race...
Repeal of the “Swaps Push Out” Rule— An Evaluation
[The following post is contributed by Mandar Kagade, who is a Policy Analyst at the Bharti Institute of Public Policy, Indian School of Business] The United States Congress recently passed the Consolidated and Further Continuing Appropriations Act, 2015 that made headlines for reasons not at all related to appropriations; it was in the news rather for including provisions that repealed the so...
Delaware Court Ruling on Deal Conditions in the Apollo-Cooper Merger
A recent Delaware court ruling deals with matters involving the “unraveling of the Agreement and Plan of Merger (the “Merger Agreement”) by which a large Indian tire manunfacturer—[Apollo]—was to buy a large American tire company—Cooper Tire & Rubber Company (“Cooper”).” Billed as among the largest overseas acquisitions by an Indian company, Apollo was to acquire all the shares of Cooper...
A Case Study for Spinoffs
Mergers and acquisitions (M&A) transactions tend to be analyzed mostly from the acquirer’s perspective, whether they involve mergers or takeovers. At the same time, they have enormous implications for the target or the seller. Businesses may have to be downsized, contracted or split due to which companies may have to engage in sale transactions or restructuring of their business undertakings...
“Dual-class” Share Structures
The recent NYSE listing of Alibaba has once again brought to the fore the issue of dual-class share structures, as discussed in this column in the Economist. Alibaba’s founder and a group of insider shareholders have control rights that are disproportionate to their economic rights. The wave of dual-class structures in tech-IPOs was triggered by Google’s IPO in 2004, which was followed by another...
Restrictions on Tax Inversions
A few months ago, we had discussed the use of “inversion” deals by U.S. companies to minimize the effect of U.S. taxes. Since then, inversions have been the subject matter of intense debate from a policy perspective. Two potential regulatory responses have been proffered. One is more short-term by which the U.S. government limits the ability of companies to carry out inversion deals by either...
Report on Gender Diversity in Corporate Boards
The issue of board diversity has acquired considerable prominence in recent times. Although there can be various hues to the concept of diversity, one manifestation relates to gender diversity and the requirement for women directors on corporate boards. What began as a useful management strategy has acquired regulatory overtones. Several countries have incorporated gender diversity into their...
A Radical Idea for Restructuring Corporate Boards
Last week’s Schumpeter column in the Economist carries a provocative idea that involves a complete relook at the way boards of companies are structured and operated. It borrows a proposal from an article titled “Boards-R-Us: Reconceptualizing Corporate Boards” authored by two leading US corporate law academics. The column summarizes the proposal as follows: In the May edition of the Stanford Law...
Reverse Break Fees on Indian Transactions
Background; Concept Internationally, in negotiated mergers & acquisitions (M&A) transactions, it is customary to incorporate various types of deal protection devices in order to guard against a scenario where the deal falls through before it is completed and parties have in the meanwhile invested significant time and incurred costs. Two such deal protection devices that operate almost...
Comparative Paper on M&A: Transaction Structures, Law & Practice
Professor John Coates has a new paper titled Mergers, Acquisitions and Restructuring: Types, Regulation, and Patterns of Practice that is available on SSRN. The abstract is as follows: An important component of corporate governance is the regulation of significant transactions – mergers, acquisitions, and restructuring. This paper (a chapter in Oxford Handbook on Corporate Law and Governance...
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