Freeze Out

外汇网2021-06-19 14:04:57 205

An action taken by a firm's majority shareholders that pssures minority holders to sell their stakes in the company. A variety of maneuvers may be considered freeze-out tactics, such as the termination of minority shareholder employees or the refusal to declare pidends.

Also referred to as a "squeeze out".

Taobiz explains Freeze Out

Freeze outs usually occur closely held companies, where majority shareholders can converse with one another. Majority shareholders attempt to freeze out the minority from the decision making process, rendering minority voting rights useless. Such actions are often illegal and may be overturned by the courts.

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