2 ms·
I see. Let's pretend you control the Company and you convince the Company's board to issue 11 more shares, which I will subsequently buy. I'd have 11 shares; yo
by cawel 19y ago
I see. Let's pretend you control the Company and you convince the Company's board to issue 11 more shares, which I will subsequently buy. I'd have 11 shares; you'd have 10.
Is that enough for me to take over the Company? Once the stock exchange transaction is done, I can just dissolve the board in place and do as I want to?
- dkokelley 19y agoPossibly, but it depends. Some companies have special restrictions or internal regulations regarding shares and control. For instance, some smaller companies (with only 21 shares issued) may have a policy that each shareholder gets only 1 vote, regardless of the number of shares owned. Others may have a system in place where those serving at the company have more voting power. If I set it up, I could issue you 20 of the 21 total available shares, but because I'm the CEO and chairman of the board, and because the articles of incorporation state that internal shares receive extra voting power, my shares provide me with 90% control of the company. Other companies might have internal controls to prevent a radical dissolving of the board or other establishments in the company. It all depends on the articles of incorporation. As far as external regulations such as the SEC, I don't think there is too much in the way of what you can and can't do with purchasing stock. There is of course the concern for monopoly-like control of an industry, and then someone may step in, but I don't know enough about that to let you know exactly how that will work. In fact, I don't think anyone knows for sure, otherwise Microsoft wouldn't have to worry about their Yahoo! acquisition being shot down.