(This is a continuation of a post contributed by Avirup Bose) In an earlier post I discussed the importance of understanding the concept of ‘control’ while analyzing the probable anti-competitive effects of a merger especially in a partial stock ownership context. The discussion was in the background of an order of the CCI dated May 17, 2012, which basically held that if a company has a...
The Concept of Control under the Indian Competition Act: an analysis (Part I)
(The following post is contributed by Avirup Bose, who holds law degrees from the West Bengal National University of Juridical Sciences and the Harvard Law School and is qualified to practice law in India and the U.S. Avirup has worked in the New York office of Weil Gotshal & Manges and in the New Delhi office of S&R Associates. He has also briefly worked at the Mumbai office of Trilegal...
JP Morgan’s Trading Losses: Regulation and Governance
There has been a great deal of debate surrounding JP Morgan’s hedging losses announced last week. There is some mystery surrounding the nature of the transactions involved, without full clarity yet on the amount of losses. Andrew Ross Sorkin has a brief explanation of the episode in the New York Times: … Here’s an overly simplistic primer, but you’ll probably get the idea: The company’s...
Confidentiality Agreements in M&A Transactions: Lessons from Delaware
Background Amongst legal documents in an M&A transaction, the confidentiality agreement plays an important role, as it does in other types of investment transactions (such as private equity), especially when it involves a public listed company. There are two key aspects of interest in any confidentiality agreement, which are also often the bone of contention in negotiations: (i) the scope of...
Substance vs. Form Conflict in True Sale | Hong Kong Court Goes by the Language Used by the Parties
(The following post is contributed by Soma Bagaria, who is a Legal Advisor at Vinod Kothari & Company in Kolkata. She can be reached at [email protected]) In every assignment transaction, there has been a constant conflict of whether the substance or form shall dominate while determining the nature of a transaction. There are two schools of thought on this: one which gives dominance to...
Securities Regulation Redux
Over the last decade, there has been a continuous tightening of securities regulation and corporate governance norms in the US following the various corporate governance scandals (Enron, WorldCom, etc.) and the global financial crisis. This has appeared in the form of legislation such as the Sarbanes-Oxley Act and the Dodd-Frank Act. More recently, however, there has been a relaxation on some...
Women on Boards Survey
The issue of diversity on corporate boards (particularly gender diversity) has garnered much importance lately, including in academic studies. The Harvard Corporate Governance Blog cites to a GMI Ratings’ survey that measures board representation by women in 45 countries across the globe. The survey reports heterogeneity in trends both among developed markets and emerging markets as distinct...
The Debate over Staggered Boards
Staggered boards are found to be a form of anti-takeover defence. This concept, which is prevalent in several U.S. companies, ensures that only a third of the board can change each year. Hence, it would not be possible for shareholders to replace the board, except through a gradual process of changing a third of the board each year. There is an interesting battle brewing in the U.S...
Facebook’s Capital Structure and Governance
In the wake of Facebook’s mega-IPO, the Deal Professor examines the capital structure of the company, whereby it has decided to follow suit from the earlier high-profile Internet IPO of Google and go with a dual-class share structure. He notes: … an investment in Facebook is really an investment in Mr. Zuckerberg: Facebook’s offering documents show he will retain control over Facebook even when...
Crowd-Funding and Its Regulation
The concept of crowd-funding seems to have caught on. In one form, it involves small and medium-sized companies raising funding from investors using the Internet (usually social networking sites or specialist crowd-funding websites). While the concept itself is quite wide and allows for fund raising in many different contexts, it is particularly useful for small entrepreneurs and start-ups. But...
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