When management controls more than 50% of the shares of the firm, they must be concerned with the potential of a proxy fights than can lead to takeovers of the firm and the replacement of management.

Question

Quizplus · Accepted Answer

When management controls more than 50% of the shares, they have majority control, making it difficult for other shareholders to win a proxy fight or takeover without management's consent.

When Management Controls More Than 50% of the Shares of the Firm