Abstract
The article examines the value of information to the decisions shareholders are expected to make in takeover bid transactions. In particular, it addresses the facilitative role of the target board in Nigeria which the governing legislation—the Investment and Securities Act (ISA) 1999—expects the board to play through the directors' circular. The article points out that, while it is commendable for the Nigerian legislature to import takeover bid regulations from abroad, the provisions of the ISA dealing with the directors' circular demonstrate a total lack of understanding by the legislature of the importance of the circular. By examining the takeover bid regulations of the Province of Ontario, which are essentially similar to those in the ISA, the article highlights the lacunae in the Nigerian law so future reform of the law may take them into account. It concludes that, unless the information contents of the directors' circular are redesigned, shareholders will continue to suffer from avoidable information asymmetry, which may add to the transaction cost of exit.
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