Tag-Along
Private Equity glossary · Private Equity Fundamentals
Definition
Right of minority shareholders to sell alongside majority shareholders on the same terms.
Tag-Along in plain English
Picture you and a friend owning a lemonade stand together: they own 80%, you own 20%. One day a big buyer offers your friend a great price for their 80% but ignores your little slice. A tag-along right lets you say, 'if you're selling, I get to sell my shares too, at the exact same price per share.' It protects the smaller owner so the big owner can't grab a sweet deal and leave you stuck holding a piece of a company now run by a stranger.
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