I have a friend who is the CEO of a software startup. As with many software companies a large amount of value of the business lies in the software code, and data which has accrued over time.
An investor who owns around 30% of the business is blocking new investment into the business. As the business only has around 2 months runway, it is likely to go into administration after 2 months.
We believe that the investor is trying to force the business into administration, so that he can buy the assets cheaply (code and data), which he will then pass to his own external development team and use it to build a new business.
Is this legal, and what can be done to prevent this happening?