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Showing posts from October, 2014

Ooh Danone – More than just yogurt

My previous blog was on the US corporation Google Inc. This time I'll be covering the French public limited company (Société Anonyme or S.A. in French) Danone S.A., a global food company. This is a pretty complex case study and I do not intend to do it full justice here. What follows is a summary of what I believe are key characteristics of Danone S.A.'s control and ownership structure. As it was the case for my previous blog, this case is built on the concepts discussed in Chapters 1-3 of "International Corporate Governance".
Danone S.A.'s most recent company report (or 'registration document') is available from here. You might need to click on '2013' to obtain the most recent available company report at the time of writing this blog. 
This might be obvious, but it is always a good idea to start by having a look at the table of contents. This should give you a fairly good idea where to find important information on control and ownership. Below I…

How Larry Page and Sergey Brin manage to control 56% of the votes in Google Inc. with a 14% ownership stake.

The aim of this brief exercise is to enable you to identify potential differences between control rights and ownership rights in listed corporations from all over the world. This exercise is based on the concepts discussed in Chapters 1-3 of "International Corporate Governance". Further, briefer examples are contained in Chapter 3 of the book.
Before we can proceed just a reminder what we mean by control and ownership. Ownership is defined as ownership of cash flow rights. Cash flow rights give their holder a pro rata claim to the firm's earnings and a pro rata claim to the firm's assets if the firm is to be liquidated. Control is defined as ownership of voting rights. Voting rights give their holder the right to vote for or against a number of agenda points at the annual general shareholders' meeting (AGM), including the appointment and the dismissal of the members of the board of directors.
Unfortunately, a lot of the corporate governance literature, including…