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The Case for Market for Corporate Control in Korea

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Authors
Kim, Hwa-Jin
Issue Date
2008
Publisher
BK 21 law
Citation
Journal of Korean Law, Vol.8 No.2, pp. 227-276
Keywords
corporate governancetakeovermarket for corporate controlproxy contestcontrolling shareholderCommercial Codetender offer
Abstract
This Article offers an assessment of the preliminary evidence that the market for corporate control functions as a disciplinary mechanism for poor corporate governance in Korea. It analyzes SK Corporation’s fight against Sovereign Asset Management, contest for control over the Hyundai Group, KT&G’s fight against Carl Icahn, and LG Group and Carlyle’s proxy contest against Hanaro Telecom, together with relevant laws and regulations. These high-profile cases dramatically exemplified the role of takeovers in the improvement of the corporate governance of Korean companies, and brought about active policy discussions in respect of the market for corporate control and takeover defenses. This Article will also provide a quick overview over the provisions in draft new Korean Commercial Code related to the market for corporate control and takeover defenses, including squeeze-out, poison pills, and dual-class commons. This Article argues that as the increasing exposure of control to the market could eliminate the inefficient controlling shareholder system in Korea, the new Korean Commercial Code should strike a balance between the active market for corporate control and effective takeover defensive tactics for the benefit of all shareholders and the value of the company.
ISSN
1598-1681
Language
English
URI
http://hdl.handle.net/10371/85149
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College of Law/Law School (법과대학/대학원)The Law Research Institute (법학연구소) Journal of Korean LawJournal of Korean Law Volume 08 Number 1/2 (2008)
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