Procedural Issues in Mergers and Acquisitions of Companies: A Comparison between Nigeria and India

Abstract

Mergers and Acquisitions (M&A’s) are, nowadays, frequent events in the lifecycles of companies, on the basis that M&As are one of the most successful means of enabling companies and economic entities achieve profits, whether through entry to new markets, taking advantage of economies of scale or reducing the costs associated with producing a greater number of products or services. India is now one of the leading nations in the world in terms of mergers and acquisitions while, Nigeria has also enjoyed an unprecedented high volume of mergers and acquisitions since 1999.  In both jurisdictions, the laws have laid down procedures for mergers and acquisitions. In India, sanction of the High Court is an essential prerequisite for the effectiveness of mergers; whereas In Nigeria judicial involvement in sanctioning mergers has been significantly reduced. This paper examines the procedural issues involved in mergers in these two populous developing countries of the Commonwealth with a view to learning a lesson from the situation of each other and recommending reforms to the laws of both countries. This article begins with a highlight of the regulatory framework and meaning of merger and acquisition in Nigeria and India; gives an overview of the types of merger and examines the procedural issues in mergers in both Nigeria and India. The paper makes a comparative analysis between the two jurisdictions. The paper acknowledges the comprehensiveness of the laws in both jurisdictions however call for plugging some of the identified gaps in the law.