Date: Nov 21, 2016
By: Staff writer, with CNA
The Legislative Yuan has tightened the rules governing the implementation of tender offers for company acquisitions in a bid to protect minority shareholders.
An amendment to the Securities and Exchange Act (證券交易法) was passed by the legislature on Friday, stipulating that potential buyers proposing tender offers must present proof of their financial stability to authorities before the acquisition process can begin.
The amendment was proposed by Chinese Nationalist Party (KMT) Legislator Lai Shyh-bao (賴士葆) after Bai Chi Gan Tou Digital Entertainment Co (百尺竿頭) on Aug. 30 announced that it was withdrawing a tender offer that it had proposed in late May to buy 38 million XPEC Entertainment Inc (樂陞科技) shares, or 25.17 percent of the gaming software developer, at NT$128 per share, almost 22 percent higher than XPEC’s share price at the time.
The decision by Bai Chi to walk away from the deal caught the market off-guard and led to a rout in XPEC shares, which caused massive losses for investors. [FULL STORY]