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Majority Shareholder 

What It Is:

 A majority shareholder refers to a shareholder who owns over 50% of  stock in a company.

How It Works/Example:

 A single shareholder who maintains ownership of more than 50% of a company's outstanding

stock qualifies as a majority shareholder. Majority shareholders may be individuals, such as

company founders, or other companies that hold more than 50% of  shares as part of their 

balance sheet assets.

Why It Matters:

 A majority shareholder's ownership position provides the shareholder with substantial power over 

a company.

Definition of 'Golden Share'A type of share that gives its shareholder veto power over changes to the company's charter. A golden share

holds special voting rights, giving its holder the ability to block another shareholder from taking more than a

ratio of ordinary shares. Ordinary shares are equal to other ordinary shares in profits and voting rights. These

shares also have the ability to block a takeover or acquisition by another company.

Investopedia explains 'Golden Share'These shares were most popular during the 1980s with governments who wanted to maintain control over 

 privatized companies. Golden shares are used mainly in the United Kingdom. In the European Union however,

golden shares have been deemed illegal by the government. This type of share controls at least 51% of voting

rights. A company can only issue golden shares after passing special resolutions and changing their 

Memorandum and Articles of Association. This document governs or dictates a company's relationship with

outside businesses

Golden Share

hold the 'golden share' so that security concerns and naonal interests are safeguarded What It Is:

 A golden share gives the holder the right to veto changes to a company's charter. Golden

shares exist primarily in U.K.-based companies.

How It Works/Example:

For example, let's say that Company XYZ wants to sell itself to Company ABC. The British

government holds a golden share in Company XYZ and thus has the right to veto the transaction

even if the other shareholders of Company XYZ and Company ABC approve.

Typically, governments obtain golden shares when they privatize national companies. Thecompanies issue shares to the public, but the government retains veto power over certain

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company actions via the golden share. With golden shares, the holders can block mergers,

prevent certain people from acquiring more than a certain proportion of shares in the company

and stop companies from making any changes to their charters. This system was popular in the

1980s; the European Union has since banned the practice.

Private companies sometimes create or retain golden shares when they spin off subsidiaries (thegolden shares help them retain control over the subsidiary's actions and prevent competitors

from taking the subsidiary over). Family-owned companies also might use golden shares to allow

an impartial third party to have a voice during conflicts. Some companies also issue golden

shares to nonprofit organizations or similar partners in order to ensure there is a check against

the interests of the shareholders in matters of values or social commitments.

Why It Matters:

 A golden share is a way to control a company. For good reason, many consider golden shares

unfair because they allow the holder to overrule the wishes of all the other shareholders, even if 

those other shareholders constitute a majority of the ownership.

innovave rules and regulaons on the State’s intervenon powers in the event of extraordinary transacons

concerning companies (“Strategic Companies”) doing business, as the case may be, in the defence and naonal

security, and in the communicaons, energy and transports strategic sectors (“Strategic Sectors”) laws and regulaons shall apply to the companies doing business in the Strategic Sectors, namely to the

companies carrying out, using the words of the legislator ‘an acvity of strategic signicance for the defence

and naonal security system’ and those holding ‘the networks and systems, the assets and relaonships of 

strategic signicance for the energy, transports and communicaons sector ’. 

A golden share is a nominal share which is able to outvote all other shares in certain

specified circumstances, often held by a government organization, in a government company

undergoing the process of   privatization and transformation into a stock -company.

Contents[hide] 

  1 Purpose 

  2 History 

  3 Legal challenges 

  4 References 

  5 External links 

Purpose[edit source | edit]

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This share gives the government organization, or other shareholder, the right of decisive vote,

thus to veto all other shares, in a shareholders-meeting. Usually this will be implemented

through clauses in a company's articles of association, and will be designed to prevent

stakebuilding above a certain percentage ownership level, or to give a government, or other 

shareholder, veto powers over any major corporate action, such as the sale of a major asset or 

subsidiary or of the company as a whole.

In the context of government-owned golden shares, this share is often retained only for some

defined period of time to allow a newly privatised company to become accustomed to

operating in a public environment, unless ownership of the organisation concerned is deemed

to be of ongoing importance to national interests, for example for reasons of national security.

History[edit source | edit]

The term arose in the 1980s when the British government retained golden shares in

companies it privatised, an approach later taken in many other European countries, as well asthe former Soviet Union.

It was introduced in Russia (Zolotaya Aktsiya, "Золотая Акция" in Russian) by law on

 November 16, 1992.

Legal challenges[edit source | edit]

The UK government's golden share in BAA, the UK airports authority, was ruled illegal by

European courts in 2003, when it was deemed contradictory to the principle of free

circulation of capital within the European Union.[1] The European Court of Justice also held

that Portugal's holding of golden shares in Energias de Portugal is contrary to European

Union law since it presented an unjustified restriction on free movement of capital .[2]