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Lessons Learned the Hard Way #1

Beware of companies where insiders/management control greater than 50% of voting stock. Shareholders in this situation are nothing more than minority partners with zero power to influence insiders/management decisions. Unless your interests align exactly with those of insiders/management, you’re likely to get screwed. 

I learned this lesson the hard way over a decade ago when a microcap company I had invested a considerable amount of money in was "taken under" by the family controlling over 50% of the voting shares.  The "family" made a ridiculous tender offer for the company at a price well below tangible book value, and then of course voted to accept the offer.  As minority shareholders, our only recourse was to take them to court, which we did, and won.  But why get involved in such nonsense in the first place?