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CII: Lyft’s planned share structure harms investors

Joe Mont | March 4, 2019

The fight over the issuance of dual-class shares is beginning another round.

The Council of Institutional Investors—a non-profit association of pension funds and endowments with combined assets of about $4 trillion—is expressing “deep concern” about Lyft’s initial public offering filing “because of its egregious dual-class share capital structure and the lack of sunset provisions to unwind it within a reasonable time period.”

Sunset provisions, it says, are “an essential tool” for protecting public investors in dual-class companies by ensuring adoption of “one-share, one-vote” voting power that is directly proportional to an investor’s capital at risk.

Lyft’s IPO filing with the Securities and Exchange Commission revealed plans to create two classes of stock: Class A shares with one vote per share for public...

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