The value of share liquidity in private companies
By Ståle Løvbukten
Share liquidity in private companies is often viewed with scepticism. However, facilitating transactions internally between shareholders can have amazing effects for both the company and its investors.
Private companies often restrict transfer of shares in order to control who are to become shareholders, and to regulate the power balance between shareholders. The downside of this is reduced access to capital for the company, as well as lock-in of potential inefficient shareholder structures…