Rethinking Kuwait’s Mandatory Acquisition Regime. A Proposal for Improved Financial Market Participation

      Аннотация: The ongoing trend in the field of mandatory acquisitions is to consider issues from the perspective of minority shareholder rights. How can a minority shareholder obtain a fair opportunity whenever a mandatory acquisition occurs in the corporation? In this noble pursuit for minority rights in the corporation arises the common mandatory bid rule (MBR), which offers minority shareholders the option to sell shares at a price equal to the controlling seller.Kuwait, as it began to develop its market, implemented the MBR to protect shareholders. Yet, it now appears that this adoption may not have the intended results on market growth in Kuwait. Adoption of the MBR in Kuwait raises many questions as to why, how, and for what purpose it was considered the mechanism to protect minority shareholders in Kuwait.In order for Kuwait to develop a more robust exchange, certain modifications need to be made to its market practices, specifically its MBR. This paper explores the history of the MBR in Kuwait and then examines how it has been used in Kuwait to protect shareholders but discourage acquisitions, resulting in stagnation that contrasts with the goals of Kuwait’s Development Plan of 2035.

Ключевые слова: MBR, Boursa Kuwait, Corporate Acquisition, Kuwait 2035 Vision, public company, controlling shareholders, Capital Market Authority, Portfolio investments, Foreign Issuers