The ownership structure of a company refers to the distribution of shares among different types of shareholders, such as insiders, institutional investors, retail investors, and foreign investors. The ownership structure can have significant implications for the company's performance, governance, and valuation.
One aspect of the ownership structure is the free float, which is the percentage of shares that are publicly traded and available for purchase by anyone. The free float reflects the liquidity and marketability of the company's shares, as well as the potential for price volatility and takeover bids. A higher free float generally indicates a lower risk of market manipulation and a higher valuation.
Another aspect of the ownership structure is the blocking stakes, which are large shareholdings that can influence or prevent certain corporate actions, such as mergers and acquisitions, dividend payments, board appointments, and strategic decisions. Blocking stakes can be held by insiders, such as founders, managers, or family members, or by external investors, such as activist shareholders or hostile bidders. Blocking stakes can have positive or negative effects on the company's performance and governance, depending on the motives and interests of the holders.
Therefore, knowing the ownership structure of a company is important for investors, analysts, regulators, and other stakeholders who want to understand the dynamics and incentives that shape the company's behaviour and value.