Ms. Arnaz Pestonji, Advocate-Bar Council of Maharashtra & Goa, Jitendra Chauhan College of Law, University of Mumbai (2016-2019)
ABSTRACT
This descriptive article provides a comprehensive analysis on possible takeover defences available to Indian entities encountering a threat of hostile takeovers under Indian law. For this purpose, this article provides a brief background on what constitutes a hostile takeover, the commercial rationale for carrying out hostile takeovers, the regulations governing hostile takeovers in India and the takeover defences available to target entities in India. It is pertinent to note that there are certain characteristics which make certain type of companies more attractive, and thereby more susceptible to hostile takeovers. It is therefore imperative that such companies adopt strategies which protect themselves against hostile evasions.
The main aim of this article is to look into the most commonly adopted takeover defence practices and analyse each takeover defence based upon its efficiency to deter hostile raiders. The article throws light on the regulatory framework in India which governs hostile takeovers and describes legal impediments which prevent Indian companies from availing possible takeover defences.
By scrutinising the benefits and consequences for pursuing a takeover defence, this article deduces which takeover defence is suitable in which scenario and further evaluates the impact on Indian companies pursuant to carrying out takeover defences. Lastly, it recommends defence tactics which are most suitable in the Indian corporate scenario.
