kontrollpremier

Kontrollpremier is a term used in corporate finance to describe the additional price paid to obtain a controlling stake in a company. In Norwegian and other Scandinavian languages, kontrollpremier is the plural form of kontrollpremie; the English equivalent is control premium. It captures the value buyers assign to governance rights, voting power, and strategic influence beyond the value of the target's shares before an offer.

In practice, kontrollpremier arises in public tender offers, mergers, and leveraged buyouts. It is typically measured as the difference between the offer price per share and the pre-offer trading price, multiplied by the number of shares that confer control. The resulting premium is what investors are willing to pay to acquire a majority of voting rights, not just ownership of shares.

Determinants of the premium include expected governance improvements and synergies, competition among bidders, the target's liquidity and market visibility, regulatory and anti-trust considerations, and the risk of overpayment. Premium levels vary across markets and deal types, and may be higher in privately negotiated transactions or when control carries significant additional value.

Limitations and interpretation: The premium can reflect strategic value, control rights, and the bidder's financing structure, making it difficult to isolate pure governance value. Announcement effects, market conditions, and time to completion can also distort measured premiums.

See also: control premium, mergers and acquisitions, takeover bids.