Drag along rights | Practical Law

Drag along rights | Practical Law

Drag along rights

Drag along rights

Practical Law UK Glossary 9-107-6155 (Approx. 4 pages)

Glossary

Drag along rights

The right, contained in a company's articles of association for a majority of the shareholders (typically 75% or more in nominal value), or a majority of investors in a private equity or venture capital transaction, to accept an offer to buy their shares and to force the holders of the remaining shareholders to accept such an offer. This aims to ensure that a buyer is able to acquire the entire issue share capital of the company.
For an example of a drag along clause: