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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › Shares Premium
Hello sir,
can I ask please why a company might sell newly issued shares at a higher price and not issue the new shares (par value) at a higher price ? Thank you
If a company has already been making profits and investors expect it to do well in the future, then they will be prepared to pay more than the par value for the new shares.
Thank you for your reply. My question is why the new shares aren’t issued in a bigger price? Thank you
But they normally are issued at a higher price as I explained in my previous answer (and as I explain in my free lectures).