Shareholder value og aktionærers individualrettigheder ved virksomhedsoverdragelser

Mads Højbo Møller & Mathias Pastwa

Student thesis: Master thesis


This thesis addresses the shareholders’ individual rights when a listed Danish company has received an offer for purchase of the assets and a public takeover bid from a shareholder value perspective. The problem is inspired by the asset sale by the listed company, Topsil Semiconductor Materials A/S, to Taiwan GlobalWafers Co., Ltd. in June 2016, where Topsil’s board of directors chose to sell the company’s assets at a time where a public offer for the purchase of the company (shares) was pending. The shareholders were not given the opportunity to decide whether to accept or reject the public takeover bid.
Under current legislation, a board may frustrate a public takeover bid, unless the Board Neutrality Rule is adopted by the general assembly. The Board Neutrality Rule state that the board may not frustrate a public takeover bid, unless it has been approved by the general assembly cf. Section 339 of the Danish Companies Act (“DCA”). Pursuant to current the board may maximize its own utility and avoid being affected by external market mechanisms such as a market for corporate control. Thus, the board may reject public takeover bids without having to obtain the approval from the general assembly. Due to the board’s obligation to ensure maximization of general shareholder value and protect each shareholders' individual rights, the board is not capable, as in the Topsil case, to consider each individual shareholder valuation of the company. However, because of each shareholders' individual return requirements, they value the company differently.
Our conclusion is that the board should not be able to decide regarding a public takeover bid without consulting the general assembly, even if there is an offer for the assets. The shareholder's individual rights represent a fundamental right to have an efficient capital market. Hence, the implementation of the Board Neutrality Rule does not create the intended protection of shareholder rights, since listed Danish companies, in general, have not enacted the rule. Through an interdisciplinary corporate law, governance and game theory analysis it is shown, that an amendment of Section 339 of the DCA could in fact result in a Kaldor-Hicks improvement and increased utility for the shareholders, which may also be applied to the Topsil case.
An amendment to Section 339 of the DCA will be a paradigm shift from the previous stakeholder approach in the DCA into a more shareholder value-based approach and would lead to greater legal certainty, a more efficient and functioning market and ensure the shareholders' individual rights.

EducationsMSc in Commercial Law, (Graduate Programme) Final Thesis
Publication date2017
Number of pages134