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Don’t give special voting rights to minorities

  • By Alan Knott-Craig
  • June 2, 2022

The Companies Act was designed by very clever people.

It affords protections to minority shareholders, but allows the business to operate on the basis that the majority gets what it wants.

So when someone wants to buy a minority stake in your company and wants special voting rights, just say no.

You’re setting yourself up for trouble later on if you let minorities have special rights, and you’ll pay a price.

The only exception is when you’re desperate for cash.

That’s when you have no choice but to give away special voting rights.

And that’s why you should try never be desperate for cash.