MAJORITY STOCKHOLDER Meaning and
Definition
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A majority stockholder refers to an individual, group, or entity that holds more than 50% of the total outstanding shares of a company's stock. In other words, it is the owner or owners who possess a controlling interest in a corporation due to their significant ownership stake.
Being a majority stockholder grants significant power and influence within a company as it offers the ability to control decisions, determine the company's direction, and elect the board of directors. This control is often achieved through holding a majority of voting rights, allowing the majority stockholder to shape corporate policies and make crucial decisions that impact the business.
Majority stockholders typically invest a substantial amount of capital into the company and are rewarded with a larger portion of the profits. Their ownership stake also entitles them to a share of dividends and the right to sell their shares when desired. Additionally, they may enjoy additional benefits such as precedence in receiving company information and having a say in matters affecting the company's future.
Given their significant influence, majority stockholders have a legal and ethical responsibility towards minority shareholders and are expected to act in the best interests of the company as a whole. They must consider the impact of their decisions on other shareholders, employees, and stakeholders while fulfilling their fiduciary duty to maximize shareholder value.
Common Misspellings for MAJORITY STOCKHOLDER
- najority stockholder
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- mzjority stockholder
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- mahority stockholder
- manority stockholder
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- maiority stockholder
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- majirity stockholder
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- majoeity stockholder
Etymology of MAJORITY STOCKHOLDER
The word "majority" comes from the Latin word "maior", which means greater or larger. It entered the English language in the late 16th century, derived from the Old French word "majorité".
The term "stockholder" refers to an individual or entity that owns shares or stocks in a corporation. It originated in the 17th century, combining the word "stock", which refers to a share or ownership in a company, and the suffix "-holder", denoting possession or ownership.
When combined, "majority stockholder" refers to an individual or entity that possesses the greatest number or percentage of shares in a company compared to other stockholders. The term is commonly used in corporate governance to indicate the controlling interest or ownership in a corporation.
