Directors Under Siege

The receipt of a takeover proposal is a critical moment for any listed company. How a company responds in the days, weeks and months that follow will most likely have a profound effect on the value, if any, received by the company’s shareholders.

It is important to recognise that the role of the board in responding to a takeover proposal starts long before the receipt of any takeover proposal. Importantly, the actions and conduct of the board in the period leading up to the receipt of any takeover proposal will have a significant impact on the result of any contest for control which develops.

In this article, Tony Damian and Clayton James of Herbert Smith Freehills discuss the “why” and “how” of takeover response preparation. These issues are relevant for all listed companies, whether big or small. The article also makes a key differentiation between strategic and tactical preparation and the impact that those two things can have.

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