"If the Michigan Legislature is going to interfere to deprive shareholders of the option to remove directors of public companies domiciled in Michigan whenever their boards are challenged, why would investors allocate capital in a state that deprives them of their rights?" Press Release from Biglari Holdings, as reported by MIRS News
The bill changed the rules of corporate governance in the middle of the game so as to benefit the politically well connected president of a Michigan insurance company against the will of a majority of the shareholders, who wanted to replace him by selling majority control to Biglari. Specifically, the bill — now the new law — required a super-majority vote of two-thirds of shareholders to approve the sale of a majority stake company.
Legislators may not know how to respond Biglari's question ("We're sorry"?), but these comments from Larry the Liquidator suggest that he and other investors will know:
"Take the money. Invest it somewhere else. Maybe, maybe you'll get lucky and it'll be used productively. And if it is, you'll create new jobs and provide a service for the economy and, God forbid, even make a few bucks for yourselves."
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