Dual-class share structures in Canada : Actions multivotantes : quelques modestes propositions

The aim of this paper is a) to outline the scope of the issue in Canada, b) review the terms of the debate, c) introduce relevant research findings and d) propose a framework of safeguards that could enhance the benefits of dual share structures and minimize their potential downside. [...] However, when no qualified family member of the controlling shareholder is actively engaged in the management or on the board of the company, the board of directors should establish with the controlling shareholder an orderly process of transition from a dual-class capital structure to a single-class one. [...] Technically, in these cases, the holders of controlling shares could sell the control of the company without any offer made to the holders of other classes of shares;. [...] The coattail provision Clearly, the coattail provision, along with the tighter governance rules implemented over the last ten years and the Canadian legal framework for protecting the rights of minority shareholders, have removed most, if not all, of the drivers of price premium and private benefits for Canadian dual-class-share structures. [...] The controlling shareholders of these companies could legally sell the control of the company and pocket the premium paid by the acquirer without a similar offer having been made to the minority shareholders.