Reverse Stock Split (Noun)
Meaning
A decrease in the number of outstanding shares of a corporation without changing the shareholders' equity.
Classification
Nouns denoting acts or actions.
Examples
- The company's board of directors approved a reverse stock split to reduce the number of outstanding shares and increase the par value per share.
- As a result of the reverse stock split, the total number of outstanding shares decreased from 10 million to 1 million.
- The reverse stock split was implemented to simplify the company's capital structure and make its stock more attractive to investors.
- Following the reverse stock split, the shareholders' equity remained unchanged, but the number of shares they owned was reduced proportionally.
- The company's decision to undergo a reverse stock split was part of its broader effort to restructure its finances and improve its competitiveness in the market.