Merger of Companies and its Impact on Partners and Shareholders

Abstract

The present study deals with the reasons and importance of merger of companies in Palestine. The study approaches the issue in two sections: the first defines the concept of merger, focusing on its definition, forms, and scope of application. The second section examines potential impacts on partners and shareholders. It is divided into four subsections: partners’rights during merger; shareholders’ right to manage the merging or the new company; partners’ right to object to the merger proposal; and right to appealagainst merger decisions. The researcher concludes that, because company merger has not been sufficiently regulated by the Palestinian law, the applicable Jordanian Company Law No. 22 of 1997 is applied in Palestine. Regarding the issue of determining the shares of partners and shareholders, it isargued that more than one criterion should be considered, and that the exchange rate should not be restricted or determined by the shareholders.