atans1

Why shareholders must vote

In Corporate governance on 23/11/2011 at 6:21 am

Or why a founder of a business who wants to control 51-75% of a company after it goes public is daft.  He should aim for a decent float.

Company law says ownership of 50% plus one share entitles an investor to take control of a company. In practice, the picture is often much less clear. A simple majority can be achieved with much less, so long as some investors can be relied upon not to cast their votes. The UK experience http://www.guardian.co.uk/business/2011/nov/20/boardroom-control-minority-shareholders

In S’pore, in early November 2011, the chairman of K-Reit rejected a call to call for a poll at an EGM, presumably because the law didn’t compel him to because there was  no five-member call for a poll or a request by unitholders controlling 10% voting rights. Some minority unitholders objected to a deal* betwen K-Reit and its sponsor Keppel Land. But not enough turned up at an EGM to demand a poll?

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*Details tomorrow in another posting on corporate governance.

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  1. Sinkies just go EGM or AGM for free buffet only lah. As long got steady capital appreciation and dividends can liao lah. Stock don’t crash and become like MF Global or Minibonds or High Notes or Pinnacle Notes or Pan Electric can already lah. Mana wu eng to read the godamn financial reports or to vote??

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