A Comparison of the Law Relating to Schemes of Arrangement and Takeover Offers in New Zealand

Abstract

Owning shares in a company affords the holder of the shares certain rights against that company. While these rights “may be negated, altered, or added to by the constitution of the company”, shares generally confer on the holder “the right to [one] vote on a poll at a meeting of the company on any resolution”. The Companies Act 1993 (the CA) provides a non-exhaustive list of resolutions that a shareholder has the right to vote on. This list includes resolutions that appoint or remove a director, alter the company’s constitution or approve a major transaction. It follows that if a shareholder held a significant proportion of a company’s shares that shareholder would be able to wield control over the company through their ability to cast their votes on a resolution at a general meeting.