Series 79: Control Share Acquisition Statute

Taken from our FINRA Investment Banking Exam

Definition of the term Control Share Acquisition Statute...

a type of anti-takeover that caps the voting power of large shareholders under certain circumstances. For example, a prospective acquirer with 51% of a target’s shares might be allowed to cast only 25% or 33% of the votes at a shareholders’ meeting. In many cases, the target’s board has the power to waive this restriction so that it does not prevent non-hostile M&As.

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