HOSTILE TAKEOVERS IN KOREA: TURNING POINT OR STICKING POINT FOR POLICY DIRECTIONS

Young-Cheol K. Jeong, Yonsei Law School

Abstract

While mergers and acquisitions are becoming an important part of Korean economy, poison pills and multiple voting rights are being introduced to deter foreign capital's intrusion to Korean economy. As the Korean economy is dominated by conglomerates with ownership model, this would strengthen the undue power of the founding families. In order to continue to develop the Korean economy with open capitalism, further protection on the incumbent management appointed by the founding families would be abolished, but they should be required to be neutral and ultimately shareholders would have the authority to make a decision of the future the company in hostile takeover situations.