Taiwan regulator tightens M&A rules for financial sector

Taiwan’s Financial Supervisory Commission unveiled plans to tighten rules on mergers and acquisitions in the financial sector, effectively blocking hostile takeovers. The proposed amendments would require acquirers to either obtain a non-objection resolution from the target company’s board or demonstrate control of a majority of shares or board seats. The move follows the regulator’s rejection last year of CTBC Financial’s USD4.1bn unsolicited bid for Shin Kong Financial. The new rules aim to ensure market stability and will be open to public comment for 60 days. Additional changes include mandating cash-only public takeovers to curb share price volatility and raising the minimum initial stake required for acquisitions to 25% from 10%, signaling tighter scrutiny in Taiwan’s crowded financial industry.