Shareholder transaction – what is it and how important is it for a certain group of individuals? To begin with, most companies are not just owned by one or two people. Most often, the ownership of an establishment mainly depends on the number of individuals as well as shares or stocks that are invested towards a business. A person can own 10% of the entire company and this can be computed or calculated through the number of investment or shares that he / she holds.

This is how most businesses usually compute the amount of money you will get from your investment. If you have bigger shares and the money is continuously making money, you’ll generate more profit or revenues from it. However, on the other hand, if you have bigger shares and the establishment has to close due to financial reasons, expect that you are the person who will lose a bigger amount of investment.

This is a setup that you usually see not just in private businesses, but even in public corporations. It is very common to see a group of people fighting against their shares and even buying more shares especially if the establishment has been making a pretty decent amount of money. Although it may sound really complicated, there is one way to make things less complicated and to legalize everything – and this is what a shareholder transaction is all about.

The transaction is defined as the interest(s) that a shareholder or stock holder whenever someone is buying or selling their shares. Because this is a very sensitive area that needs to be discussed in the financial industry, a legal expert has to be present or hired to make sure that all papers or documents will be processed appropriately.

Most often, a shareholder transaction is being requested by someone with bigger shares in the corporation, and a lawyer is asked to take care of all the papers and the overall process at the same time.

Your shareholder transaction will list the total number of years that you have been holding that specific share in an industry, and it will also list how much further that particular percentage will be yours. The situation may generally vary on the terms and conditions set by the company and the shareholders. This is why it is important that you have a lawyer or someone who has legal experience and knowledge in this field.

Finding someone who is experienced in this field requires a lot of time, effort and consideration. A shareholder transaction is an important aspect in any other form of business. Regardless if you are keeping your share, buying one or selling it, finding an expert in this field is the most important aspect to be taken into consideration. You can search for established companies and services through the internet, along with some references from other business owners that you may know of. If you can check their history as well as the number of shareholder transaction cases or situations that they were able to hold, pay attention to these it can greatly help you figure out whether their services are needed or whether you need to find someone else.

30 June 2012