Equity Dilution
/ˈekwɪti daɪˈluːʃən/
Definitions
- (n.) The reduction in existing shareholders' ownership percentage caused by the issuance of new shares.
Equity dilution occurred after the company issued more stock to raise capital.
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Commentary
Equity dilution is a critical concept in corporate finance and securities law, often addressed in shareholder agreements and financing rounds to protect ownership percentages.
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