What is a Majority Shareholder
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What is a Majority Shareholder?
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What is a Majority Shareholder?

Corporate Stock is used by Corporations as a way to raise capital. Anyone who buys Corporate Stock becomes a partial owner of the Corporation which issued the Corporate Stock. Each share of Corporate Stock owned by an investor, or Shareholder, represents a proportionate share of interest in that Corporation.

Anyone who owns Corporate Stock is called a Shareholder of the Corporation.

A Corporation normally retains at least 51% of its Corporate Stock. The remaining shares of Corporate Stock are sold directly by the Corporation to purchasers or on the open market through stock brokers. Some shares of Corporate Stock are given directly to employees of the Corporation.

If one Shareholder (or a common voting block) owns more than 50% of all available Corporate Stock then that Shareholder is referred to as a Majority Shareholder.

The Majority Shareholder will be able to determine the way in which the Corporation conducts business. This is the reason why Corporations try to own (or control) more than half of their Corporate Stock.

The Majority Shareholder normally controls the Corporation by electing the Board of Directors who oversee the Corporation and appoint the Officers of the Corporation.

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