Summary ch.5 finman 354 sumamry

Chapter 5 legal issues pertaining to MBAs

Introduction

a




These transactions are beneficial
to increase profitability but could harm consumers
other market players
The regulatory authorities in a country should protect rights of consumers
other market participants when MBAs by corporate restructuring occur



Parties in a MBA should take note of the following laws




1 The companies act
designed to promote accountability transparecy corporate efficiency regulatory
certainty
corporate governance




Act
liability
contains standards
provision
to regulate directors conduct 4 includes strict director


Act abolished the concepts of par h nominal values for shares
It introduced a solvency liquidity test
definitions
Regulated company

, offer




affected transaction




Main purpose regulation of affected transactions or
The takeover regulations offers involving regulated companies



The takeover regulation panel TRP was established to regulate offers by affected
transactions


The TRP
SYFY that
insuffney
shareholders



fairly
Requirements set out in the companies act takeover regulation relate to
various stages of the MBA process