The financial press is abuzz with Manchester United’s possible listing on Singapore’s stock exchange (SGX) with a dual class share structure. For example, the Financial Times notes: Manchester United football club’s $1bn initial public offering in Singapore will use a two-tier share structure that will minimise the influence of outside shareholders over the US-based Glazer family. The ability to...
Diaspora Bonds
The Economist has a piece that discusses the advantages of diaspora bonds to poor countries. It notes: The idea is simple. Poor-country governments can issue bonds and market them to emigrants in rich countries. There are several advantages to milking members of a diaspora. They are often patriotic: they like the idea that their savings will pay for bridges and clinics at home. They are patient...
Fiduciary Duties and the Nature of an LLP
While the position of law in relation to the inter-se relationship between partners of a firm is fairly well-settled, there is no great clarity on similar issues arising in the context of LLPs. It is clear that the “double agency” rule of partnerships does not apply to LLPs: but, if LLPs are seen as a hybrid form of a partnership and a company, does the law impose any fiduciary duties on members...
CSX/TCI: Appellate Court on Disclosures and Takeover Law
Sometime ago, we had the opportunity to discuss a decision of the U.S. District Court for the Southern District of New York pertaining to the use of cash-settled total-return equity swaps by acquirers and whether that would trigger disclosure requirements under appropriate U.S. regulations governing takeovers. Now an appellate court has pronounced its decision in which the majority of the judges...
Rating Agencies Back in the Spotlight
S&P has indeed made a bold move by downgrading United States’ sovereign rating. While there may by political opposition, quibbles with the arithmetic, and the like, there is a strong view that those amount to “shooting the messenger”. The downgrading by S&P assumes greater importance because it comes in the wake of determined efforts by governments to tighten their control over credit...
Enforceability of “Side Letters”
Background It is customary for parties to enter into “side letters” in corporate and commercial transactions. Side letters are documents which are ancillary to the principal transaction documentation. There are a number of reasons why parties could potentially enter into side letters, rather than include their subject matter in the principal documentation. Side letters are useful when parties...
UK Bribery Act: Impact on Indian Companies
The UK Bribery Act 2010 is scheduled to become effective July 1, 2011 following the issuance of detailed guidance in March. This is expected to have a significant impact on Indian companies having a demonstrable business presence in the UK. In this behalf, an article in the VC Circle by Saionton Basu and Tom Clark details the various steps to be taken by affected Indian companies to “review or...
Rule 10b-5 and the “Maker” of a statement: Janus Capital v. First Derivative
Last week, in a 5-4 verdict, the US Supreme Court once again narrowly interpreted Rule 10b-5, this time holding that only the “maker” of a false statement could incur 10b-5 liability: “maker” in this context being defined as “person or entity with ultimate authority over the statement.” The case, Janus Capital Group Inc. v. First Derivative Traders, reversed the Fourth Circuit’s holding...
Globalisation: Myth and Reality
A new study asserts that the importance and virtues of globalization, including cross-border trade and foreign investment, may have been overplayed. The Economist has a column discussing Pankaj Ghemawat’s book World 3.0: Global Prosperity and How to Achieve It. It points to some astonishing data and conclusions that emerge from the book: Mr Ghemawat points out that many indicators of global...
Poison Pill Lives on in Corporate America
(Mihir had earlier highlighted the importance of a recent Delaware Chancery Court decision in the Airgas case. We now have a post by Karan Singh Tyagi, who succinctly analyzes the impact of the decision under Delaware law and goes to the nub of the issue involving the role of the board of directors of a target that is the subject matter of a hostile bid. Karan is currently an associate at Gide...
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