Service
1373 Points
Posted on 03 March 2011
Hi,
It can be in any form of agreement where investor agrees to invest in the company on certain terms and conditions. As they invest in th company they take some special rights such as Appointing their director on the Board, their approval for any sort of major amendments including increasing paid-up capital, merger, etc. All these powers are included by way of agreement.
Normally they invest in the unlisted company which is having potential to grow. They remain in the company for some period after which they insist for listing of the shares in SE for their exit. They invest for the sole purpose of return they never intent to control the Compnay.
For more clarification, plz comment
Regards
Jaideep Pandya