On Tuesday, the Commodity Futures Trading Commission approved, by a 3-1 vote, a proposed rule on positions limits in commodities derivatives. The proposed rule reflects changes to an earlier rule on positions limits that was invalidated in 2012 by a Federal district court in the District of Columbia.
High Tide Warning in Global Shareholder Activism
In its new report titled “Rising Tide of Global Shareholder Activism,” the Financial Strategy and Solutions Group of Citi observes that shareholder activism has spread to companies in all sectors, of all sizes and across all geographic regions.
As the report suggests, activist hedge funds have accumulated their funds and, in order to put this financial firepower to work, are exporting their activism abroad. On the so-called “supply side” of the phenomenon, shareholder interventions are increasingly encouraged by the presence of undervalued targets with conservative financial strategies and a lack of top-line growth, dispersed share ownership, and reforms that enhance shareholder rights.
China’s GlaxoSmithKline Investigation
GlaxoSmithKline’s (GSK) investigation serves as a cautionary tale to American companies, particularly health-focused companies, interested in operating in China. GSK’s pharmaceutical sales plummeted sixty percent in the third quarter due to a Chinese anti-corruption investigation. In July 2013, the Chinese government accused the pharmaceutical giant of funneling approximately $500 million to government officials, medical associations, hospitals, and doctors in order to boost sales of their products. China has arrested several GSK officials and will likely require the company to pay a fine above $2 billion. The investigation is part of China’s efforts to curb business corruption and clean up its health industry, which is undergoing a massive expansion.
Selling Your Company: Deal Structure to Unlock Additional Value
Most sellers know that preparing for a sale requires certain homework, such as cleaning up business and corporate records, and considering key employee retention arrangements. Another important way to prepare for a sale is to be ready to negotiate deal structure.
Managing Tax Audits and Appeals – 2013, a seminar co-sponsored by BCLBE and Crowell & Moring LLP
On October 17 and 18, 2013, BCLBE and Crowell & Moring LLP co-sponsored a two-day seminar entitled “Managing Tax Audits and Appeals.” The seminar was held at Le Meridien hotel in San Francisco, and featured Crowell & Moring attorneys as well as three esteemed guest speakers.
Prospectus Disclosure Regime in Europe — the Proportionate Disclosure Regime and Supplementary Prospectuses
Regulators have recently clarified two important aspects of the prospectus regime that applies across the European Economic Area pursuant to the Prospectus Directive (Directive 2003/71/EC as amended by Directive 2010/73/EU). The Prospectus Directive provides the overarching European regulatory framework for the publication of prospectuses in connection with debt and equity securities being offered to the public or admitted to trading on regulated markets in the EEA.
Crowdfunding: A Dream or Reality?
Last Wednesday, the Securities and Exchange Commission released new rules for crowdfunding under the 2012 Jumpstart Our Business Startups (JOBS) Act. Crowdfunding gives startups a way to raise capital through the Internet and thereby reach a large, diverse set of investors.
Recent Developments in the LIBOR Scandal
In the last two weeks there have been important developments in what is commonly referred to as the “LIBOR Scandal,” a scam concerning the manipulation of the London Interbank Offered Rate (LIBOR). Britain’s Serious Fraud Office has notified twenty-two people at various banks of potential prosecution.
Potential “Big Law” Merger: Pillsbury and Orrick
A potential merger is on its way as two of high-profile firms prepare to merge which could result in one the biggest firms in the United States. Orrick Herrington & Sutcliffe, which has a very strong base in Silicon Valley, is set to merge with Pillsbury Winthrop Shaw Pittman, which has an equally strong base in New York and Washington DC. One of the leading global law firms in the field of public finance, Orrick also is particularly focused in serving companies in the sectors of technology, energy and project finance. On the other hand, Pillsbury also has a strong presence in the fields of asset finance, technology, energy, and natural resources. This merger would form one of the ten largest firms in the country. In terms of attorney head count, it would be one of the world’s twenty largest firms with a total of approximately 1,700 attorneys and is expected to have an annual revenue of about $1.4 billion.
SEC Investor as Purchaser Subcommittee Issues Recommendations Related to Broker-Dealer Fiduciary Duty
The Investor as Purchaser Subcommittee (the “Subcommittee”) of the SEC’s Investor Advisory Committee (the “Committee”) issued two principal recommendations (the “Recommendations”) regarding SEC adoption of a uniform standard of duty for investment advisers and broker‑dealers engaged in the delivery of personalized investment advice to retail investors.