Prof. Jayanth R. Varma's Financial Markets Blog

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Prof. Jayanth R. Varma's Financial Markets Blog, A Blog on Financial Markets and Their Regulation

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Sun, 10 Apr 2005

MCI-Verizon: Some shareholders are more equal than others

Verizon is buying out MCI’s largest shareholder at a higher price than what it is offering to others. Once again, we see a big flaw in US takeover regulations. Michael Jensen pointed out long ago that the US got its takeover regulations badly wrong in the 1980s. I think they are yet to get it right. All the corporate governance reforms post Enron have not touched this area at all. Interestingly, very little of the takeover regulation in the US comes out of the capital market regulator.

India’s takeover code has a number of deficiencies but in this respect at least it is a lot better.

Posted at 19:34 on Sun, 10 Apr 2005     View/Post Comments (0)     permanent link