The Anti-takeover Decision Making Right In Tender Offer

Takeover and anti-takeover are the products of the capital market development.Anti-takeover decision making right is a right that the decision making body couldadopt anti-takeover measures when the acquirer initiates a hostile tender-offer. In thecurrent legal system of our country, acquirer could adopt anti-takeover measures butthe legislation on who can make this decision is still blank. This article will addresson who can make this decision：shareholders or the board.The juridical practice on anti-takeover measures in the US has a great influenceon the anti-takeover measures around the world. In the US, there exist variousanti-takeover measures and most of them are proved to be effective. Currently, thereare two modes on the legislation of anti-takeover decision making rights: the UKmode or refer to as the shareholder decision making mode and the US mode or referto as the board decision making mode. In my opinion, the board decision makingmode is better than the shareholder decision making mode, this article will address onthis issue.This article has6parts. The introduction part will introduce the current situationof the anti-takeover cases, and then propose the issue in this article. The first part willreview on the anti-takeover measures in the US. This part gives the backgroundknowledge for this article. The second part will introduce and make a compare of theanti-takeover decision making right in UK and US, then make an analyses on thereason for this distinguish. The third part will use the method of economies to analysison the merits and demerits of the shareholder centralism to prove that the cost ofshareholder participation is too high and shareholder participation is inconformitywith the economic theory. The forth part of this article will discuss the theory ofRonald H. Coase and Kenneth J.Arrow, I will use these theories to prove that directorsare the best choice to be the subject of anti-takeover decision making right. This partwill also relate to the truth of the anti-takeover decision making right. The last part isthe conclusion part, I will make a conclusion.Let the board be the subject of the anti-takeover decision making right is not onlythe value orientation of the corporate law in our country but the tendency of our world, moreover, it is the blueprint for the legislation of anti-takeover system in our country.For legislation, explicit the duty of the board and control the rights of the controllingshareholders is the best way to protect the shareholders.