26th September 2006, 9:39 PM
Great Rumbler Wrote:Any stockholder can sell their stock to anyone who wants to buy it. Buyouts can be stopped in one of two ways; either get together a majority of stockholders who don't want to sell or keep a majority of stock within the company [say, with the board of directors or the President/CEO].
If a majority of stock is held by people who have no vested interest in the company [i.e. stock traders] then there's nothing really to stop another company from purchasing a controlling share. They just have to through around enough money to convince people that selling will result in a higher yeild than holding on to their stock.
It's really that simple.
Why would any company in their right mind own anything less than 51% of their own stock? Isn't that a disaster waiting to happen?
"On two occasions, I have been asked [by members of Parliament], 'Pray, Mr. Babbage, if you put into the machine wrong figures, will the right answers come out?' I am not able to rightly apprehend the kind of confusion of ideas that could provoke such a question." ~ Charles Babbage (1791-1871)