Takeover in general is achieved by acquiring an effective percentage of shares of company, ensuring control to the acquirer, if takeover does not receive the approval of the board of directors of the target company, it is described as a hostile takeover. The latter is not necessarily detrimental to the company's interest, as it can benefit the company by changing its strategy and replacing its management with another efficient and active one, resulting in the optimal exploitation of its resources. In other cases, it may be detrimental to the interests of the company, that the acquirer plans are not commensurate with the company's future objectives and plans, or the offer may not be appropriate. In such cases, there is a need to frustrate the takeover attempt. This raises the question of the authority of the board of directors of the target company to take defensive tactics to thwart the takeover, and the legal disciplines that ensure that it does not abuse the use of its powers, which the laws differed and split to two directions, the first of which recognizes the Board of Directors with the power to frustrate hostile takeover, American law represents this trend, and the second adopts the rule of neutrality of the Board of Directors, leaving the decision to the shareholders, and this is the approach of Emirati law. This raises the question of the best legal regulation in achieving the objectives of the legislation in supporting and protecting companies, especially in light of the recent legal regulation of takeover in the United Arab Emirates.
Yousif, Alaa Yakoob Dr.
"Legal Controls of the Authority of the Target Company's Board of Directors in Responding to a Hostile Takeover: A comparative Study under Emirati and American Laws,"
مجلة جامعة الإمارات للبحوث القانونية UAEU LAW JOURNAL: Vol. 84:
84, Article 3.
Available at: https://digitalcommons.aaru.edu.jo/sharia_and_law/vol84/iss84/3