Shareholders may from time to time consider that their rights as shareholders are being infringed. These might be rights arising under the articles of association of the company, contractual rights under a shareholders’ agreement or the statutory right not to be unfairly prejudiced. Shareholders may also be concerned that a director or directors are not properly discharging their duties to the company, in which case they may consider a derivative action on behalf of the Company against the rogue director or directors.
George Green can advise directors and shareholders as to the rights which shareholders enjoy in these circumstances. Shareholder activism is more prevalent than ever before.
Unfair Prejudice – sale of shares
All shareholders enjoy statutory protection against the affairs of a company being conducted in a manner that is unfairly prejudicial to the interests of shareholders generally or one or more shareholders. In addition, directors have statutory duty to promote the success of the company for the benefit of its shareholders as a whole. Shareholder actions are difficult and expensive to prosecute. The law recognises that shareholders may from time to time fall out and that where an individual shareholder claims to have been a victim of unfairly prejudicial conduct, he risks having his claim struck out by a court if a reasonable offer is made for his shares.
At George Green we focus upon delivering pragmatic and commercial solutions in shareholder disputes. We recognise that litigation is often a distraction and costly to all parties and yet many law firms encourage clients to litigate.
We differentiate ourselves from other law firms by a seamless approach between our corporate and litigation teams.
The determination of fair value may be critical to the resolution of disputes and some innovation may be required in structuring any transaction in a way that is acceptable to all parties and that is capable of being sensibly funded.
Our multi-disciplined approach assists in the promotion of more expeditious and cost effective solutions, avoiding the emotional turmoil and distraction of protracted disputes.
A business may develop in ways where it becomes appropriate for different parts of the business to be allowed to develop independently. Alternatively where the relationship between shareholders may have irretrievably broken down the shareholders may both wish to continue to have some interest in the business. In these circumstances, a form of demerger may be appropriate so that the business or businesses will be split into separate ownership. There are a number of different types of demerger and reconstruction and we can advise upon and document the most appropriate solution for a particular circumstance.