Going Public/Going Private
A panel of family business owners and experts recently met in Europe to discuss the pros and cons of public ownership. The key comments follow:
Managing two types of shareholders – permanent and temporary shareholders – is very difficult. They want different information; they have different levels of understanding; they have different emotional perspectives.
Laws in most countries concerning minority shareholders’ rights discourage going public. (The laws were characterized as “the power to blackmail the majority owner.”)
In England, with the elimination of the death tax, more and more family companies are taking themselves private.
The difficult market for attracting and retaining key people is making stock options and public ownership more tempting – purely to compete in the market for talent.
It’s an increasingly tough decision.
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