Elon Musk: Always A Douche

[Admiral Yi]

How do you sell other people's shares?

Happens all the time with takeovers.

[The Brain]

How do you sell other people's shares?

Happens all the time with takeovers.

What's the legal mechanism? And what's the purpose of it?

[Admiral Yi]

What's the legal mechanism? And what's the purpose of it?

You hold a proxy vote.  Shareholders vote their shares aye or nay to the takeover at price X.  Folks who vote nay have to sell regardless.

I suppose the purpose is to enable takeovers.

[The Brain]

What's the legal mechanism? And what's the purpose of it?

You hold a proxy vote.  Shareholders vote their shares aye or nay to the takeover at price X.  Folks who vote nay have to sell regardless.

I suppose the purpose is to enable takeovers.

Why do the "overtakers" need 100% of the shares? From a societal perspective?

[Sheilbh]

You hold a proxy vote.  Shareholders vote their shares aye or nay to the takeover at price X.  Folks who vote nay have to sell regardless.

I suppose the purpose is to enable takeovers.

Or if it's a private company you'd often have drag along provisions in the shareholders' agreement.

[DGuller]

Mergers happen all the time, to companies that have millions of shares outstanding.  If a single shareholder held a Liberum Veto on the merger proposal, then so many synergies would be lost and redundancies left unstreamlined.  In my case, I presume that 49% of the shares would vote no to the merger at the price of 1 cent per share, but they would be outvoted by 51% of shares that vote yes.

[DGuller]

Why do the "overtakers" need 100% of the shares? From a societal perspective?

How can they work otherwise?  What would be the meaning of the share of a company that no longer exists?

[Admiral Yi]

Why do the "overtakers" need 100% of the shares? From a societal perspective?

[I suppose] they prefer 100% to avoid SEC reporting requirements and regulation.

I suppose the gain to society is the freedom to contract.

[The Brain]

Why do the "overtakers" need 100% of the shares? From a societal perspective?

How can they work otherwise?  What would be the meaning of the share of a company that no longer exists?

Presumably it would still exist in this situation. But I buy the synergy thing.

[The Brain]

So are there any protections for minority shareholders, or are the "1 cent takeover" risks factored into the price of minority positions?

[Admiral Yi]

So are there any protections for minority shareholders, or are the "1 cent takeover" risks factored into the price of minority positions?

Rules against self-dealing like DGuller mentioned for one.

[The Brain]

So are there any protections for minority shareholders, or are the "1 cent takeover" risks factored into the price of minority positions?

Rules against self-dealing like DGuller mentioned for one.

Hairy palms?

[Admiral Yi]

Incidentally an IMF economist taking a sabbatical to teach at the Kennedy school said the failure of Russia's first attempts at free market reforms and the rise of the oligarchs was largely due to the failure to protect minority shareholder rights.  Yeltsin handed out shares to Ivan and Olga and Boris Oligarch did exactly what DGuller described.  And the country never recovered.

[The Brain]

Silver lining to everything I suppose.

[Legbiter]

Counter-intuitive - maybe hot take - given how polarised the US is on political lines, maybe we'll see loads of conservatives/Trump-fans start adopting EVs by buying Teslas?

A South African billionaire on a drunken lark sets out to "reform" social media, resulting in Red America and Blue America switching cultural status markers...

Sounds like a great premise for a Neal Stephenson novel.