On asset stripping

I’ve mentioned that I don’t plan to use incremental capitalisation in Britain Under Steam. I’ve also suggested that companies might start after a small number of shares have been purchased, instead of the more traditional 60%. There is a major problem with this combination. If a player can start a fully-capitalised second company by purchasing just 20% of the shares, he or she could then strip the assets from this company and then dump it. Even if the shares were worthless, this would give their first company 100% of the capital at a mere 20% of the cost (which would be incurred by the player).

This is far too easy a gain. It’s not that I want to forbid asset stripping as a tactic; I just want it to have a balance between pros and cons. I conclude that the ability to start companies by buying just 20% of the shares only really works with some form of partial capitalisation.

If the director receives the current price for the shares, then the loss to the player is even less. In my post about Investors vs. Entrepreneurs, I already mentioned the rule that shares in a company without a train will be valued at half-price. I am considering adding that the director’s certificate in a trainless company will be worthless. This is an attempt to make asset stripping more costly.

This will require an anti-dumping rule. If Players A and B have 5 and 4 shares in a company respectively, and Player A sells 2 shares, then the directorship would normally pass to Player B. The anti-dumping rule will allow Player B to immediately sell the minimum number of shares required to avoid inheriting a worthless director’s certificate.

Even with these rules, floating a fully-capitalised company on the sale of 20% of its shares won't work for me.