Should securities regulators allow companies going public with dual-class shares?

• Main Author: Aurelio GURREA-MARTINEZ
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2018
• Subjects: Comparative law; Dual-class shares; Voting rights; Business Organizations Law; Comparative and Foreign Law
• Online Access: https://ink.library.smu.edu.sg/sol_research/3702; https://ink.library.smu.edu.sg/context/sol_research/article/5660/viewcontent/should_securities.pdf
• Institution: Singapore Management University

In the past years, several companies, such as Google, Linkedin, Facebook, and Alibaba, went public with dual-class share structures, that is, share structures that typically include two classes of ordinary shares carrying unequal voting rights. Those shares with more voting rights (eg, ‘class A’ shares) are usually held by the company´s founders and executives, while the rest of the company´s share capital, formed by stock with regular voting rights (eg, ‘class B’ shares), is generally sold to outside investors.