Tag: Mergers and Acquisitions
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Scheme of Arrangement & Tax Authorities: The Vodafone Essar Case
[Posted by Umakanth Varottil] Lately, the income tax authorities have been actively objecting to schemes of arrangement initiated under sections 391 to 394 of the Companies Act, 1956 on the ground that the schemes are intended to avoid applicable taxes. Such objections are usually raised when the scheme is presented for sanction of the High…
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Interpreting the Takeover Regulations
[Posted by Umakanth Varottil] With the current Takeover Regulations (that came into effect in October 2011) being fairly recent, they are being subjected to interpretation during the course of their functioning. SEBI this week issued two sets of informal guidance in the context of one takeover. The first pertains to whether an acquirer holding less…
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Delaware Courts Allow Litigation to Move at the Speed of Business
[Posted by Umakanth Varottil] [The following post comes to us from Andrea Tinianow, who is a vice president and assistant general counsel at Corporation Service Company. She is also a Delaware attorney. This post relates to the Delaware Supreme Court’s decision upholding the Chancery Court in Martin Marietta Materials inc. v. Vulcan Materials, Inc. We…
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Confidentiality Agreements in M&A Transactions: Lessons from Delaware
[Posted by Umakanth Varottil] 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…
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The Debate over Staggered Boards
[Posted by Umakanth Varottil] 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…
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Bhopal Gas Tragedy: Revisiting Issues of Liability under Corporate Law
[Posted by Umakanth Varottil] Over at Critical Twenties, Arghya Sengupta has initiated a debate “on the twin issues of the legal responsibility of a successor multi-national company for the liabilities of its predecessor as well as … thoughts on the appropriateness of the Olympics partnering with such a corporation would be most appreciated.” I have…
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Miscellaneous
[Posted by Umakanth Varottil] 1. Reactions to Vodafone The discussions on the Vodafone judgment of the Supreme Court continue to raise questions regarding tax avoidance, and also aspects of corporate law (distinguishing the sale of shares and sale of assets). While Prashant Bhushan has raised questions regarding the judgment on several counts (here and here),…
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Outbound FDI and M&A
[Posted by Umakanth Varottil] The Reserve Bank of India has published a paper/address titled “Outward Indian FDI – Recent Trends & Emerging Issues” that examines various regulatory aspects of outbound FDI by Indian companies. It considers various business aspects and comments upon regulatory issues and concerns. The latest issue of The Economist also looks at…
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Amendments to the Merger Regulations
[Posted by Umakanth Varottil] (The following post has been contributed by Rahul Singh, Assistant Professor of Law, National Law School, Bangalore (on leave) and Senior Associate, Trilegal) We live in interesting times where the Minister for Corporate Affairs (Indian competition authority’s administrative Ministry) speaks about helping Kingfisher Airlines and slaying the dragon of runaway inflation…
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Calcutta High Court: Stamp Duty on Mergers/Demergers
[Posted by Umakanth Varottil] We have earlier discussed the peculiar issues that have arisen on whether schemes of arrangement in the form of mergers and demergers are liable to stamp duty in states where the Indian Stamp Act applies or where there is no specific entry for levying stamp duty on such transactions. In relation…