How do they regulate how many shares must a company have in the stock market...?

Question

I don not understand this, about stakes, if I have a company I could sell a million stakes and make a big capital, or how is it?

Answer 1

Firstly you arrive at a valuation for your company. This could be on the basis of asset value or future earnings. This might be based on a comparable company already listed. Say the industry  standard is a p/e of 8 then you multiply your current earnings by 8 to establish a value based on earnings. Lets say tthis gives a valuation of £5m for yyour company. The brokers bringing your company to the market might suggest a valuation of £4.5m due to market conditions or whatever. So you then offer 1/2 of the company in a public offer or placing. The broker may suggest a  small price might be the best plan to attract private investors, say around 50p. So you are raising £2.5m at 50p That's 5m shares going to the market.  You can juggle around with these figures; How much money does the comnpany need to raise? What percentage are the current owners willing to sell?

Answer 2

The more shares the lower the value of the stock. It would be better for your company to sell 1,000 shares of stock for $10 a share , then to sell 10,000 shares for $1 each.

Supply and demand affect the price of your shares.

Answer 3

There is no regulation about how many shares a company can issue.  The number of shares is not really that important.  1 million shares at 100 is the same amount of capital as 10 million shares at 10.

If you had a company, you could indeed sell a million shares at $100 each and get $100,000,000, but only if you could find buyers.  People don't buy shares to own pieces of paper.  They buy to own a piece of a worthwhile company.

Answer 4

Each exchange has set the minimum stock that a company has outstanding for listing.

Before you're company is listed is must be a publically traded firm.  

It would be better if you do it the correct way.Get yourself a securities lawyer and they will hold you hand in getting to your goal.   You're not going to get here at Yahoo or any other media such as this.

Answer 5

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