Law Quarterly

Law Quarterly

THE PERFORMANCE OF COMPANY EXECUTIVES IN TAKING OVER A POSITION IN ANOTHER COMPANY

Document Type : Research Paper

Authors
Abdolhossein Shiravi 1
Samad Yousefzadeh 2
1 Professor of Law, Department of Private Law, Faculty of Law and Political Sciences, University of Tehran (Farabi Campus), Iran
2 PhD in Private Law, University of Tehran Kish International Campus, Iran
10.22059/jlq.2020.253913.1007014
Abstract
The acquisition is to take the control of management in other companies by purchasing the majority of voting stocks, in order to eliminate the inefficient management. Creating value and expanding shareholders wealth, as two important economic goals, are the main goal for taking over another company. Nevertheless, it should be understood whether, in practice, the incentives of managers to acquire with applying this strategy, will lead to the creation of value and the increase in the wealth of the company's shareholders? The hypothesis in this research is a negative answer to the above question, explaining the reasons and the need to support the shareholders in the acquiring companies.
Keywords
Acquisition
Friendly Acquisition
Hostile Acquisition
Acquisition Motivation
Acquirer
Target Company

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Law Quarterly
Volume 50, Issue 1
Spring 2020
Pages 97-115