News today from Insee, France's official statistical agency, that economic growth was precisely nul in the first three months of the year will not have raised spirits.Shares in both Alstom and Bouygues Group, whose telecoms arm was thought to be a takeover target after the group lost its bid to buy rival SFR in April, both fell after the takeover measure was announced.
In the 1980s, when corporate America was under attack from hostile raiders, companies pushed hard to get legislatures to adopt anti-takeover measures and to validate poison pills.
They also raised doubts about the company's assertions that taking MetLife public would not diminish dividends to policyholders and contended that anti-takeover measures included in the conversion plan could depress share prices, and thus the value received by policyholders.
The United States and Japan have adopted anti-takeover measures, but in Japan a recent proliferation of poison pill anti-takeover defense arrangements and a decades-old tradition of cross-shareholdings were common practices hurting minority shareholders, critics said.
A slew of hostile takeovers during the 1980s led many states to legislate to allow firms to implement anti-takeover measures, and these have been backed by the Supreme Court.In the absence of an open market for takeovers, the allocation of share options came to be seen as one of the key ways of motivating managers, with unintended consequences.
One of my biggest pet peeves is anti-takeover measures like poison pills and staggered boards that destroy shareholder value.
Cash is the main coinage (see chart).This trend has played into the hands of the big private-equity firms, which now lead a fifth of all takeovers, measured by value.
TECHNOLOGY Correction: October 7, 2004, Thursday An article in Business Day on Monday about Oracle's request to a Delaware court to void a corporate anti-takeover measure, or "poison pill," at PeopleSoft misidentified a company that initiated an earlier hostile takeover and challenged the anti-takeover actions in court.
PeopleSoft is hoping that the acquisition and an anti-takeover shareholder rights measure known as a "poison pill" will thwart Oracle's efforts.
A study by the United States Embassy here concluded, "Despite de jure open policy, elaborate corporate protective measures against hostile takeovers may de facto block acquisitions or takeover".
From the limited case law on the matter, it appears that Ohio would subject both the takeover decision and any defensive measures to deferential review (known as the business judgment rule) and find them acceptable so long as bad faith, fraud or self-dealing on the part of Diebold's directors could not be shown.
