How to Sell Shares in a Malaysian Company

Updated on Friday 09th December 2016

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Foreign investors who are partners in a company set up in Malaysia can sell the shares they own in the respective company. Investors can also sell a part of the shares they own, but the procedure has to be completed following specific regulations which are prescribed by the applicable legislation, but also by the shareholders’ agreement, a document which provides an in-depth framework on the shareholder’s rights and obligations. Those who want to open a company in Malaysia can receive assistance on the share transfer procedure from our team of specialists in company formation


Selling shares in a company Malaysia  


In order to sell the shares the investor owns in a Malaysian company, specific procedures have to be completed. The transfer of shares must be agreed upon by the other shareholders, depending on the value that is being sold, but also on the seller’s statute, as there are different regulations for minority and majority shareholders

Those who want to start the procedure of company formation in Malaysia are advised to sign a shareholders’ agreement. As a general rule, the document is usually signed by the shareholders of medium and large companies. The document is useful as it provides a clearer image on the procedure related to the transfer of shares, as well as on many other aspects. Our team of company formation agents in Malaysia can help businessmen in drafting the shareholder’s agreement


Share transfer legislation in Malaysia  


The share transfer in Malaysia is regulated by the Companies Act 1965. Restrictions regarding the transfer of shares in a public company are not permitted under the applicable legislation, but they are necessary in the case of a private limited company

An important aspect when selling shares in a company in Malaysia set up as a private limited company is that its directors are allowed to refuse the respective transfer if they may consider so. 

The shareholders’ agreement is a very useful tool for the investors who are minority shareholders in the company. The document can be drafted in such a manner that their rights will be protected. 

Businessmen who are interested in selling shares of a Malaysian company are invited to contact our team of company formation consultants in Malaysia

Comments

Janice

November 25, 2016

I think that the shareholders' agreement should be a compulsory document for any company, as it can provide a comprehensive image on this matter, as it often happens to have various conflicts on the transfer of shares.



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