How can a 20% ownership position represent significant influence over a company?

Expert Solution

The ownership is very important in respect of the company as it represents the voting rights. The voting rights can influence the decision of the company. An investor holding 20% ownership can influence the decision. They fall into minority interest and there are certain which gives the power. However, 20% voting right is enough to challenge the financial decision. They can affect the composition of board of directors. They can participate in policy making decisions, etc. So, they can affect the compnay in several ways.

jeff jeffy answered 2 years ago

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