The golden share: an innovative tool for corporate restructuring

The golden share, or specific share (when allocated to the State), was introduced in France by the law of August 6, 1986, concerning the modalities of privatizations.

This law enabled the creation of shares with particular characteristics to allow the State to retain a veto right over certain strategic decisions or to grant it specific rights that are uncorrelated with its stake in the capital of privatized companies. Since then, these specific shares have evolved and are now used in various financial contexts, such as for Management Companies (ManCo) in leveraged buyouts (LBOs) or to provide enhanced protection to creditors and facilitate the restructuring of distressed companies.

The rights that may be attached to a specific share are outlined in the ordinance of August 20, 2014, regarding the governance and capital operations of publicly held companies, amended by the law of August 6, 2015, for growth, activity, and economic equality, known as the "Macron Law," and the law of May 22, 2019, concerning the growth and transformation of businesses, known as the "PACTE Law."

Over the years, and in response to concrete needs, these legislative developments have allowed for the use of golden shares in circumstances beyond the protection of national interests, notably within the French financial landscape, playing a key role in managing default situations.