Deficiencies of the Allocation Mechanism of Target Company's Anti-Acquisition Decision Rights under the Chinese Shareholder Primacy
Year: 2023
Type: article
Abstract: With the continuous deepening of China's market economy system reform, corporate acquisitions, especially hostile acquisitions, are becoming increasingly popular. Therefore, there is an urgent need for the market to improve the relevant legal provisions for anti-takeover decisions and measures. To begin with, this article takes the allocation of anti-acquisition decision-making right from the perspective of comparative law as an index. Then, it sorts out the decision-making models and related measures of anti-hostile acquisitions. Subsequently, this article takes the equity dispute between China Vanke Co., Ltd. and Baoneng Investment Group Co as a case study, using literature research methods and qualitative analysis methods as the basic research approaches to explore various practical difficulties faced by Chinese companies in anti-hostile acquisitions under the shareholder primacy. This refers to the limitations of the legislative design of the relevant shareholder primacy for Chinese listed companies in the face of hostile acquisitions, which include an analysis of the implementation authority of acquisition defense measures, the responsible parties, and the reasons for the insufficient power of the board in anti-hostile acquisition activities. Ultimately, in order to overcome the above deficiencies, this article proposes suggestions on limiting the power of shareholders' meetings to expand the function of the board, improving the mechanism for the operation of directors' powers and responsibilities, balancing the overall rights and protecting interests of shareholders.
Author: Yifan Chen
Institution: Kunming University of Science and Technology
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: hybrid
OpenAlex ID: W4386689673