How will an existing company increase the number of shares? - ProProfs Discuss
Cancel
TopicsDown
Products Down
Follow Us:
FacebookTwitter
Advertisement

How will an existing company increase the number of shares?

How will an existing company increase the number of shares?

Change Image    Delete

Asked by F.William, Last updated: Sep 08, 2020

+ Answer
Request
Question menu
Vote up Vote down

1 Answer

D. Gray

D. Gray

D. Gray
D. Gray

Answered May 10, 2018

Yes, a company can technically create a greater number of shares but it will have variously ranging effects on the existing stake holders. Usually, a company creates a greater number of shares after a stock split. As a result of this, the value of the stocks does not get diluted.

Another way is to create some shares and hold the shares in the treasury. Again, this event does not have any notable effect on the value of the existing shares. However, when a company creates shares for the purpose of selling them for an increased funding, the value of the stock holder gets diluted.

upvote downvote
Reply 

Advertisement
Advertisement
Search for Google images Google Image Icon
Select a recommended image
Upload from your computer Loader
Image Preview
Search for Google images Google Image Icon
Select a recommended image
Upload from your computer Loader
Image Preview
Search for Google images Google Image Icon
Select a recommended image
Upload from your computer Loader

Email Sent
We have sent an email to your address "" with instructions to reset your password.