THE REGULATORY FRAMEWORK FOR TAKEOVERS IN THE UNITED KINGDOM AND NIGERIA: SHAREHOLDERS AND EMPLOYEES PROTECTION IN PERSPECTIVE

UoM administered thesis: Phd

  • Authors:
  • Francis Okanigbuan

Abstract

Abstract The University of Manchester Candidate: Francis Aigboviose Okanigbuan Jnr Degree: Doctor of Philosophy Title: The Regulatory Framework for Takeovers in the United Kingdom and Nigeria: Shareholders and Employees Protection in Perspective Date: May 2016This thesis critically examines the extent to which the interests of company shareholders and employees can be protected during takeovers in Nigeria. High costs of takeovers lead to losses or insignificant gains to shareholders of acquiring companies. To mitigate the effects of the costs on shareholder wealth, employees are often disengaged. This raises concerns about the effectiveness of takeover administration in Nigeria, especially in light of the high rate of unemployment. Consequently, an assessment of the role of company managements and the effectiveness of the current institutional framework for takeover administration in Nigeria is justified.The thesis adopts a comparative approach to ascertain how similar takeover challenges in Nigeria are addressed in the United Kingdom. Takeovers in both jurisdictions are regulated by the combined effects of Statutory Rules and Administrative Rules and similar challenges can be experienced in both jurisdictions. Further to this, two issues were identified. First, to what extent are shareholders and employees currently protected during takeovers in Nigeria? This issue identifies the scope of the problems. Secondly, are there any peculiar or similar effects of regulatory control over takeovers in Nigeria and the United Kingdom? This determines the comparative function of the thesis, in relation to the scope of the problem that is identified by the first issue. The relevance of the new institutional economics in the development of institutions was identified and illustrated using two main institutional aspects. First, the role of the informal institutions (unique societal factors) in influencing institutional developments is identified. Secondly, the thesis illustrates how the main themes of economics of institutions, namely, property rights, transaction costs economics and agency relationships can address the identified challenges. Company shares can be effectively protected as property rights of shareholders and the role of managements can be restricted to shareholder agents. Also, the thesis shows that uncertainties and incompleteness of employment contracts can indirectly lead to high costs of takeovers. This can undermine the interests of both shareholders and employees. Thus, the thesis proposes a complementary protection to shareholders and employees. It specifically recommends legal reforms to strengthen market efficiency. Further, it challenges the role of managements by constructing an administrative structure that includes employee representatives in the administration of takeovers through smart regulation and social dialogue.

Details

Original languageEnglish
Awarding Institution
Supervisors/Advisors
  • Andrew Mcgee (Supervisor)
  • Annette Nordhausen Scholes (Supervisor)
Award date1 Aug 2016