Voting interest (or voting power) in business and accounting means the total number, or percent, of votes entitled to be cast on the issue at the time the determination of voting power is made, excluding a vote which is contingent upon the happening of a condition or event which has not occurred at the time.[1]
Voting interest is one form of economic interest. Economic interests comprise all types and forms of investment vehicles that an investee could issue or be a party to, including equity securities; financial instruments with characteristics of equity, liabilities, or both; long-term debt and other debt-financing arrangements; leases; and contractual arrangements such as management contracts, service contracts, or intellectual property licenses.[2]
Ownership of more than 50% of voting shares generally gives the right of control and consolidation.[3] In special cases, control is possible without having to own more than 50% of voting stock.[4] For example, if agreed, shareholders may pass control to a chosen one owning much fewer shares (for example in the case of the two petroleum companies, MOL Group and INA - Industrija nafte).
In other cases, companies divide their stock into voting and non-voting classes, which can allow a small minority of shareholders to control a majority of the voting shares. This technique is often used to allow a company's founders to cash out much of their ownership without giving up control.
In the American media, dual-class structures caught on in the mid-20th century as families such as the Grahams of The Washington Post Company and the Ochs-Sulzbergers of The New York Times sought to gain access to public capital without losing control. Dow Jones & Company, publisher of The Wall Street Journal, had a similar structure and was controlled by the Bancroft family but was later bought by News Corporation in 2007, which itself is controlled by Rupert Murdoch and his family through a similar dual-class structure.[5]
Example
Company ABC issues 1,000,000 ordinary shares and 500,000 preferred shares outstanding. Company XYZ buys 700,000 voting shares and 100,000 preferred ones. Therefore, XYZ's voting interest is (700,000/1,000,000) = 70%, and its economic interest is (800,000/1,500,000) = 53%
References
^"Definition of voting power - Oregon Legal Glossary". www.oregonlaws.org. Retrieved 19 April 2018.
voting, interest, voting, power, business, accounting, means, total, number, percent, votes, entitled, cast, issue, time, determination, voting, power, made, excluding, vote, which, contingent, upon, happening, condition, event, which, occurred, time, form, ec. Voting interest or voting power in business and accounting means the total number or percent of votes entitled to be cast on the issue at the time the determination of voting power is made excluding a vote which is contingent upon the happening of a condition or event which has not occurred at the time 1 Voting interest is one form of economic interest Economic interests comprise all types and forms of investment vehicles that an investee could issue or be a party to including equity securities financial instruments with characteristics of equity liabilities or both long term debt and other debt financing arrangements leases and contractual arrangements such as management contracts service contracts or intellectual property licenses 2 Contents 1 Non voting interest 2 Example 3 References 4 External linksNon voting interest EditOwnership of more than 50 of voting shares generally gives the right of control and consolidation 3 In special cases control is possible without having to own more than 50 of voting stock 4 For example if agreed shareholders may pass control to a chosen one owning much fewer shares for example in the case of the two petroleum companies MOL Group and INA Industrija nafte In other cases companies divide their stock into voting and non voting classes which can allow a small minority of shareholders to control a majority of the voting shares This technique is often used to allow a company s founders to cash out much of their ownership without giving up control In the American media dual class structures caught on in the mid 20th century as families such as the Grahams of The Washington Post Company and the Ochs Sulzbergers of The New York Times sought to gain access to public capital without losing control Dow Jones amp Company publisher of The Wall Street Journal had a similar structure and was controlled by the Bancroft family but was later bought by News Corporation in 2007 which itself is controlled by Rupert Murdoch and his family through a similar dual class structure 5 Example EditCompany ABC issues 1 000 000 ordinary shares and 500 000 preferred shares outstanding Company XYZ buys 700 000 voting shares and 100 000 preferred ones Therefore XYZ s voting interest is 700 000 1 000 000 70 and its economic interest is 800 000 1 500 000 53 References Edit Definition of voting power Oregon Legal Glossary www oregonlaws org Retrieved 19 April 2018 June 30 July 1 2004 EITF Meeting PDF www fasb org Retrieved 19 April 2018 Mergers amp Acquisitions A snapshot PDF pwc com Retrieved 19 April 2018 OWNERSHIP AND CONTROL Murdoch clinches deal for publisher of Journal MSNBC Archived from the original on August 25 2007 Retrieved September 18 2008 External links EditCommon Stock vs Preferred Stock Stock This economics related article is a stub You can help Wikipedia by expanding it vte Retrieved from https en wikipedia org w index php title Voting interest amp oldid 1120520823, wikipedia, wiki, book, books, library,
