Legal Dictionary of Pakistan

minority discount

A reduction in the value of a closely held business's shares that are owned by someone who has only a minority interest in the business. ( The concept underlying a minority discount is recognition that controlling shares - those owned by someone who can control the business - are worth more in the market than noncontrolling shares. But when dissenting shareholders object to a corporate act, such as a merger, and become entitled to have their shares appraised and bought by the corporation, many courts hold that incorporating a minority discount into the valuation of the dissenters' shares is inequitable and is not permitted. See APPRAISAL REMEDY.