Law Commons^™

Evaluating Dual Class Common Stock: The Relevance Of Substitutes, Ronald J. Gilson

Faculty Scholarship

The proposal of the New York Stock Exchange to end its prohibition on listing the securities of companies with dual classes of common stock has focused public policy debate over this evolution in capital structure both too broadly and too narrowly.

The debate has been too broad because it has encompassed one situation – an initial public offering by a company with a capital structure containing dual class common stock – that should not be controversial at all. Whatever may have originally prompted the New York Stock Exchange's longstanding prohibition against listing non-voting common stock or common stock with voting …