Corporate Governance and Anti-Takeover Devices: Evidence from Australia

27 Pages Posted: 11 Jul 2000

See all articles by Ian Ramsay

Ian Ramsay

Melbourne Law School - University of Melbourne

Helen Lange

Macquarie Graduate School of Management

Li-Anne Elizabeth Woo

Bond University - Finance; UNSW Australia Business School, School of Banking and Finance

Date Written: April 2000

Abstract

This paper seeks to establish what form of management structure, ownership structure and financial characteristics are exhibited by firms that propose and subsequently adopt anti-takeover charter amendments (ATCAs) in Australia. An ATCA is a restriction of partial takeover activity implemented though shareholder approval to changes in a firm's constitution. Approval for such changes is obtained through majority agreement from a plebiscite of shareholders.

The study adopts a control sample design to analyse if characteristics differ statistically from adopting ATCA firms and those which do not adopt ATCAs during the investigation period. Following this, a logit analysis establishes the importance of variables considered to have a role in distinguishing between ATCA adoptees and firms without ATCAs.

The variables tested include proportion of independent directors; directors' shareholdings; proportion of shares held by institutional shareholders; and proportion of shares held by the largest 20 shareholders.

Various measures of performance are also tested with some evidence being found that poorly performing firms are most likely to introduce ATCAs.

JEL Classification: G34

Suggested Citation

Ramsay, Ian and Lange, Helen and Woo, Li-Anne Elizabeth, Corporate Governance and Anti-Takeover Devices: Evidence from Australia (April 2000). Corporate Governance: An International Review, Vol. 8, 2000. Available at SSRN: https://ssrn.com/abstract=224651 or http://dx.doi.org/10.2139/ssrn.224651

Ian Ramsay (Contact Author)

Melbourne Law School - University of Melbourne ( email )

University Square
185 Pelham Street, Carlton
Victoria, Victoria 3010
Australia
+61 3 8344 5332 (Phone)

HOME PAGE: http://law.unimelb.edu.au/about/staff/ian-ramsay

Helen Lange

Macquarie Graduate School of Management ( email )

99 Talavera Road
Sydney, NSW 2113
Australia
+61-2-9850-9907 (Phone)
+61-2-9850-9019 (Fax)

Li-Anne Elizabeth Woo

Bond University - Finance ( email )

Gold Coast, QLD 4229
Australia

UNSW Australia Business School, School of Banking and Finance ( email )

Sydney, NSW 2052
Australia
61-2-9385-5862 (Phone)
61-2-9385-6347 (Fax)

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