Escaping the Market: Regulating Conflicts in Going Private Transactions


SURVEY

ESCAPING THE MARKET: REGULATING
CONFLICTS IN GOING PRIVATE

TRANSACTIONS

Spring 2003 saw the publication of the Columbia
Business Law Review's second annual survey of law, with an
overview of the disclosure requirements that had recently
been implemented in securities and corporate governance
regulation.1 This year, in the third annual survey, we chose
to address a phenomenon that has resulted, in part, from
those very requirements-the increasing numbers of public
corporations choosing to go private.

The first piece of the survey, A Brief Roadmap to Going
Private, provides a broad review of the different methods
available for corporations to go private. It discusses the
typical players in a going private transaction, common
sources of funding, different ways of structuring the deal,
and relevant legal considerations. In effect a practitioner's
introduction to going private, this paper presents and
bridges the major issues involved in the typical going private
transaction.

The second piece of the survey examines the state law
component of the relevant regulatory environment against
the theoretical backdrop of the race to the top/race to the
bottom debate. Going Private Transactions: Delaware's Race
to the Bottom presents the existing theoretical frameworks
as they apply to going private transactions, introduces the
different actors at the state level responsible for the direction
of state corporate law, and analyzes the empirical evidence
on the subject.

1 Survey, The Best Disinfectant: Analyzing the Implementation of
Disclosure Requirements in Securities and Corporate Governance
Regulations, 2003 COLUM. Bus. L. REV. 579.



The final piece of the survey scrutinizes a particular type
of conflict in the going private context-a going private
transaction motivated by insider information on the part of
existing insiders, e.g. top management. Governing Insiders
Going Private on Inside Information outlines the various
legal doctrines that can be applied to this scenario, at both
the state and federal levels, and compares these doctrines in
terms of their covered conduct, remedies, and other relevant
attributes. The paper concludes with a set of
recommendations for improving the existing regulatory
framework for these transactions.

We look forward to continuing to provide you with the
survey as an annual feature of the Columbia Business Law
Review. We hope you find the materials in this survey
timely and useful, and we would greatly appreciate your
comments and feedback in order to improve the selection of
materials and format in this new Columbia Business Law
Review endeavour.

Joshua Koenig
Jason Quintana
Sarah A1-Moosa
Survey Authors

Yair Galil
Survey Editor

COLUMBIA BUSINESS LA W REVIEW [Vol. 2004