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Notes -
I’m not sure large pubcos are that much better run. Instead, I think unfortunately Marty Lipton convinced Delaware that anti takeover measures were somehow consistent with shareholder primacy when in reality they just protect management ensuring it can screw the shareholders.
I think the raw classical economics argument for prohibiting most forms of takeover defense isn’t completely wrong, but it also isn’t entirely correct. Im based in the UK which bans many of the major tactics used in the US, and I don’t think UK pubcos are run better than American ones on the whole, but I think to me the biggest issue I have with US public companies is super voting shares. These were illegal in London until about 5 years ago; every share had to have the same voting power to be (in practice) eligible for a primary listing in London and for inclusion in indices. They changed it under pressure from the government because British tech companies were IPOing in the US to preserve founder control. I think it’s a hugely negative development in ECM for shareholders, banks and the wider public.
Of course, there are a lot of other restrictions on UK pubcos. That is, there is more differences between UK pubcos compared to say Delaware ones. Also, would be interesting since some UK pubcos are England and Wales PLCs whilst others are Jersey.
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