Self-Help in Other Companies
This chapter deals with a wide spectrum of different types of company. However, by virtue of their omission from the previous two chapters they have some common features. First, there is no ready market for their shares. Secondly, some at least of the shareholders are passive investors, so that there is a separation between ownership and control.
Depending upon where they fall in the spectrum, it may be that some of the devices described in the previous two chapters may be available to the minority shareholders in these companies. However, in the vast majority of cases, the membership will not be sufficiently large to enable a power base to form which would rival that of the management and, conversely, the fact that the shareholders are not actively contributing to the company will mean that they do not have sufficient bargaining power to secure the adoption of the self-help measures described in the context of quasipartnership and joint venture companies. Of course in some cases one or more minority protection devices may already exist, since many of the companies falling within this residual group will be the successors of quasipartnerships or second- or third generation family companies where shareholders have obtained their shares involuntarily by gift or inheritance, and where shareholders' agreements or specially drafted articles of association are in place. But even so, there is no guarantee that the expectations of the company's founders will coincide with those of the current shareholders.
Therefore, in the majority of companies falling within this residual category, minority shareholders will not be able to take steps to protect themselves, and they will be forced back. onto litigious remedies where these are available.
The next part of this book examines these litigious remedies in detail.