The following Corporate guidance note provides comprehensive and up to date legal information covering:
A minority shareholder in a company does not have much power to influence its management and, therefore, sometimes their interests are disregarded. Should they need to protect their position, a minority shareholder can do so in a number of ways, eg they may bring an unfair prejudice claim, pursue a derivative action or seek a winding-up petition.
There is no definition of a minority shareholder in the Companies Act 2006 (CA 2006). Minority shareholders are usually persons who hold less than 50% of the shares in a company that have voting rights attached, meaning that they cannot block ordinary resolutions. Shareholders with less than 25% of the shares will also not be able to block special resolutions.
The two most common claims brought by minority shareholders to protect their interests are:
a claim that they have been unfairly prejudiced by the way the affairs of the company are being conducted, and
a derivative claim under the CA 2006
Shareholders can also:
petition the court for a winding up of a company under section 122(1)(g) of the Insolvency Act 1986 on the basis that it is just and equitable that the company is wound up, or
bring a claim against a director in their personal capacity, rather than as
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