Well-defined corporate governance is also a relevant asset of the company, and the shareholders’ agreement is the necessary tool for its execution.
When governance, succession, or a prospective future sale of equity interest are a concern, structuring a shareholders’ agreement becomes essential for the company. In the specific context of a potential sale in Brazilian business, two aspects deserve particular attention, as they directly impact the final value of the transaction.
1. Organization that translates into value: When shareholders initiate a process to sell part or all of the company, the corporate structure should be organized in advance, avoiding friction with potential buyers that could pressure the price downward. A shareholders’ agreement with clear rules on administrative and financial management, the scope of each shareholder’s authority, decision-making thresholds, profit distribution, succession policy, non-compete, and confidentiality conveys security to the buyer, which translates into more favorable negotiating conditions, particularly in partial acquisitions.
2. Clear rules prevent deadlock at the time of sale: Another sensitive point involves the possibility, or obligation, of selling equity interest, especially among minority shareholders or in companies with a dispersed ownership structure. Provisions such as drag-along rights (which compel a sale under certain conditions) and tag-along rights (which guarantee minority shareholders the right to sell on the same terms offered to the controlling shareholder), which are not usual in Brazil, prevent disputes that delay or even derail the transaction. With clear rules on how and when a sale should take place, the process becomes more predictable for all parties, including a potential buyer.
It is worth noting that in Brazil a company may have more than one agreement in place simultaneously, one for minority shareholders and another for controlling shareholders, for instance, or one for each family branch, in the case of family businesses.
Structuring the company rigorously is not a legal formality, but rather a strategic decision that precedes, and often determines, the outcome of any future negotiation, generating direct economic value for the sale transaction.
