Takeover Defenses Under Delaware Law, the Proposed Thirteenth EU Directive and the New German Takeover Law: Comparison and Recommendations for Reform

26 Pages Posted: 31 May 2002

See all articles by Richard W. Painter

Richard W. Painter

University of Minnesota Law School

Christian Kirchner

Humboldt University of Berlin - Faculty of Law; Humboldt University of Berlin - Faculty of Economics

Abstract

This article compares (i) Germany's highly protectionist 2001 corporate takeover law, (ii) the proposed EU Thirteenth Directive (which endorses the very different market oriented "strict neutrality rule" of the London City Code) and (iii) Delaware's "modified business judgment rule" which lies somewhere between these two approaches. The article also discusses some of the political and economic explanations for Germany's approach to hostile takeovers. The last section of the article discusses a fourth approach favored by the authors: allowing managers to initiate defenses against hostile tender offers but then allowing shareholders to veto management initiated defensive tactics through voting on the Internet.

JEL Classification: F3, KO

Suggested Citation

Painter, Richard W. and Kirchner, Christian, Takeover Defenses Under Delaware Law, the Proposed Thirteenth EU Directive and the New German Takeover Law: Comparison and Recommendations for Reform. American Journal of Comparative Law, 2002. Available at SSRN: https://ssrn.com/abstract=311740 or http://dx.doi.org/10.2139/ssrn.311740

Richard W. Painter (Contact Author)

University of Minnesota Law School ( email )

229 19th Avenue South
Minneapolis, MN 55455
United States
612-626-9707 (Phone)

Christian Kirchner

Humboldt University of Berlin - Faculty of Law ( email )

Unter den Linden 6
Berlin, D-10099
Germany
49-30-2093-3319 (Phone)
49-30--2093-3430 (Fax)

Humboldt University of Berlin - Faculty of Economics ( email )

Spandauer Strasse 1
Berlin
Germany

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