Drag-along right

Drag-Along Right is a legal concept in corporate law. The right assures that if the majority shareholder sells his stake, minority holders are forced to join the deal. This right protects majority shareholders.^[1] Drag-along rights are fairly standard terms in a stock purchase agreement. Drag-along rights typically terminate upon an initial public offering.^[2]

See also

• Tag-Along right, the converse concept
• Pre-emption right
• Right of first refusal

References

External links

• Drag-along rights
• The Dark Side of Drag-Along/Tag-Along Rights

This economics or finance-related article is a stub. You can help Wikipedia by expanding it.

This law-related article is a stub. You can help Wikipedia by expanding it.

Corporate finance and investment banking Capital structure Senior secured debt · Senior debt · Second lien debt · Subordinated debt · Mezzanine debt · Convertible debt · Exchangeable debt · Preferred equity · Shareholder loan · Common equity · Pari passu Transactions (terms/conditions) Equity offerings Initial public offering (IPO) · Secondary Market Offering (SEO) · Follow-on offering · Greenshoe (Reverse) · Book building Mergers and acquisitions Takeover · Reverse takeover · Tender offer · Poison pill · Freeze-out merger · Tag-along right · Drag-along right · Control premium · Divestment · Demerger Leverage Leveraged buyout · Leveraged recap · Financial sponsor · Private equity · Bond offering · High-yield debt · DIP financing Valuation Financial modeling · APV · DCF · Net present value (NPV) · Cost of capital (Weighted average) · Comparable company analysis · Enterprise value · Tax shield · Minority interest · EVA · MVA List of investment banks · List of finance topics