G.S. 166
CONFIDENTIAL #B
機密
6.
(g)
to negotiate to purchase, or to legislate to nationalise, either the entire share capital or a controlling interest therein, which shares could be retained by Government or sold to their nominee.
Control over Management
18.
If it is desired to prevent the present share- holders voting their shares so as to control the Board and thus frustrate executive action, the possibilities
are:
(a)
(b).
(c)
(a)
to negotiate a legally binding agreement under which they agree not to do so, or agree to -- place the shares in trust giving discretionary powers to trustees;
to negotiate to purchase (or for CMB to issue, perhaps in return for capital provided to purchase assets) sufficient shares to give Government, or its nominee, control;
to legislate and to alter CMB's Articles, by agreement with the shareholders or, otherwise, to have upon the Board nominated directors responsible to Government who by their numbers, the use of reserve powers, or force of personality, could ensure the adoption of acceptable management structures and procedures; it would probably be politically necessary despite the monopoly enjoyed by CMB, to reserve certain powers, such as declaration of dividends to the elected directors. (currently Article 120A provides for between 5 to 11 directors, and s. 9 of the Ordinance for 2 of these to be Government Directors; but there are no reserved powers).
to negotiate to restructure the capital of the company so as to divide the shares into Ordinary shares with financial and voting rights and 'A' shares with financial but no voting rights. Such an approach, even if acceptable to the present shareholders, would raise policy considerations which have not been considered by me at this stage. It could however permit Government to obtain control of voting rights for a much smaller investment than might be the case under alternative (b).
CONFIDENTIAL
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