Golden shares are a type of shares that aims to prevent a single person or a group of common shareholders from seizing sole control over a large number of shares which may lead later to sole control over the entire company.
This type of shares may be owned by entities such as governments and companies or individuals such as company’s founders or board members.
– The term of “Golden Shares” first appeared in the eighties in the UK when it had to privatize companies and in anticipation of private control over public companies, the government decided to issue the golden shares that enjoy absolute power.
– Powers of Golden Shares
– It gives its holder a voting power that exceeds 50% of the total votes of the General Assembly, so it can invalidate any vote by common shareholders.
– It grants its holder more profits than other shareholders if these profits are provided for in the terms of the company policy.
– In the case that the government is the holder of the golden shares, it has the right to object to any dangerous decision that may threaten its national security, for instance, selling a main asset or an affiliate company or even selling the entire company.
