The values and interests of shareholders change over time, and often so do the relationships between them. At the beginning, this is often shown by differences in factual issues that are based on different value concepts. In day-to-day business, different ideas about the orientation of the company lead to disputes among shareholder. Common triggers of shareholder disputes are a (perceived) imbalance in the distribution of profits, disputes about balance of shareholder support within the company, or the classic “dip into the till”.
Shareholder disputes can be a burden on a company. Whereas in the early stages of a dispute, controversial debates can still be positive because they address problems and, if necessary, solve them.
But once the fronts have hardened, the dispute can often only be resolved if the opposing shareholders go their separate ways. Company law provides various tools to separates shareholders. The departing shareholder receives compensation for leaving the company, which is just as often disputed. The leaving partner has an interest in receiving as much compensation as possible, while the company already wants its liquidity and, if possible, resorts to valuation methods that are favorable to it. It is better to call in an experienced advisor at an early stage, because the dispute among the shareholders consumes resources: money and management attention that cannot be put into the company. In many cases the parties involved do not succeed and the disputes are taken to court. Often with the same result: one of the contractors leaves the company. In other cases, the company can be split up or jointly sold to third parties.
If the dispute is ignited by the managing shareholder, it is sometimes sufficient to revoke the managing director positon but keep the position as a shareholder. Depending on the majority situation in the company, a revocation may require “important grounds. However, a serious breach of duty or the incapacity for proper management is deemed to be such grounds.
Our task as consulting lawyers is to achieve a long-term positive result for our clients in every phase of the conflict.