Understanding Minority Shareholders Protections in Relation to Mandatory Bids Rule: A Comparative Study Between Kuwait law and U.S Law
This dissertation canvasses the regulation of protecting minority shareholders in the sale control transaction under Kuwaiti law that aims to answer fundamental questions. Does the mandatory bid rule ensure adequate protection to minority shareholders? Is the board neutrality rule a proper rule in the sale control transaction in the light of the mandatory bid rule? How does the U.S law protect minority shareholders without adopting the mandatory bids rule and the board neutrality rule? Can Kuwait have her owns approach in protecting minority shareholders in the sale control transaction? In answering these questions, this dissertation offers three critiques of the system goals. First, the existence of a new controller in the target company by the mandatory bids threshold that assumed a new controller will exist after crossing it. Second, providing a fair exit opportunity to minority shareholders through ensuring the equal treatment among the target company shareholders. Third, prohibiting the boards of directors from taking any actions in the control transaction. Having offered a legal analysis of Kuwait’s new mandatory bid rule, this dissertation concludes that the rule is too porous to protect minority shareholders and achieve Kuwaiti goal to be the hub of the financial center in the area. This dissertation concludes by proposing an alternative legal approach that will be more proper to the Kuwaiti law. I call this approach the conditional mandatory bids rule. The conditional mandatory bids rule would combine between the most theories in the sale control transaction, the market rule under U.S regulation and the mandatory bids rule under Kuwaiti law
Minority Shareholders, Mergers and Acquisitions, Mandatory Bids Rule, Controlling Shareholders, Kuwait., Banking and Finance Law, Commercial Law
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