Share consideration

This topic has 1 reply, 2 voices, and was last updated 9 years ago by John Moffat.

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February 18, 2017 at 9:44 am #373005
syfar42
Member
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When we are purchasing a company using share consideration, doesn’t that mean that the target company becomes major shareholders of our company? Because they hold majority of our shares now..so how is it a purchase from our side. We are effectively selling ourselves to them aren’t we?
February 18, 2017 at 4:23 pm #373034
John Moffat
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To what extent they become major shareholders depends on how many new shares are given as consideration, although they are likely to become pretty big shareholders.
However, these are new shares being issued, so they will not be the majority shareholders.
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