Corporate Finance Law »

Eilís Ferran is Professor of Company and Securities Law in the University of Cambridge and co-Director of Centre for Corporate and Commercial Law (3CL) in its Law Faculty. She is a Fellow and Director of Studies in Law at St Catharine's College, Cambridge and a Research Associate of the European Corporate Governance Institute.

This book explores the relationship between law and corporate finance. Corporate finance theory seeks to understand how incorporated firms address the financial constraints that affect their investment decisions by using varied financial instruments that give holders different claims on the firm's assets. Recent scholarship in this area explores precisely how legal mechanisms affect corporate finance and the development of financial markets. The legal environment is crucially important in explaining the choices that companies make about their capital structure.

The book examines the key elements of the legal environment relating to corporate finance in the UK. This evolving environment has just undergone a remarkable period of far-reaching change. This was driven in part by the desire of the UK government to modernize its domestic company law, and in part by policy choices at the EU level which rely heavily on the adoption of new regulation to promote closer integration of European financial markets.

In this book, Eilis Ferran provides a detailed analysis of the technical issues arising from the new UK and European law on corporate finance, and combines this with exploration of the broader policy framework and with cutting edge theoretical and empirical research.

Note on the implementation of the Companies Act 2006

I Overview

1 The regulatory framework 3

2 Use and abuse of the corporate form as a vehicle for raising finance and managing financial risk 13

3 Capital structure - fundamental legal, accounting, and financing considerations 49

II Legal capital

4 Formation of share capital 85

5 Share allotments 125

6 Shares 147

7 Maintenance and reduction of capital 179

8 Share buy-backs and redeemable shares 203

9 Distributions to shareholders 231

10 Financial assistance 267

III Debt corporate finance

11 Debt corporate finance - general considerations 313

12 Secured debt 347

IV Capital markets finance

13 Public offers of equity securities 409

14 International equity offerings 475

15 Corporate bonds 511

Index 537