Share Capital


Share Capital
Funds raised by issuing shares in return for cash or other considerations. The amount of share capital a company has can change over time because each time a business sells new shares to the public in exchange for cash, the amount of share capital will increase. Share capital can be composed of both common and preferred shares.

Also known as "equity financing".

The amount of share capital a company reports on its balance sheet only accounts for the initial amount for which the original shareholders purchased the shares from the issuing company. Any price differences arising from price appreciation/depreciation as a result of transactions in the secondary market are not included.

For example, suppose ABC Inc. raised $2 billion from its initial public offering. Over the next year, the total value of its shares increases to $5 billion. In this case, the value of the share capital is still only $2 billion because ABC Inc. had received only $2 billion from the sale of its securities to the investing public.


Investment dictionary. . 2012.

Look at other dictionaries:

  • Share capital — or issued capital (UK English) or capital stock (US English) [http://www.intracen.org/tfs/docs/glossary/se.htm] refers to the portion of a company s equity that has been obtained (or will be obtained) by trading stock to a shareholder for cash or …   Wikipedia

  • share capital — Under the Companies Act 1985 shares may be issued by the company to shareholders in return for cash or other value equal to or greater than its nominal value. Shares in the authorised share capital are available to be issued. The issued share… …   Law dictionary

  • share capital — noun Money derived from the sale of shares in a business, and used for carrying it on • • • Main Entry: ↑share …   Useful english dictionary

  • share capital — Part of shareholders funds in a company s balance sheet. The share capital is given by the number of shares in issue multiplied by the nominal value per share. Dresdner Kleinwort Wasserstein financial glossary * * * share capital share capital ➔… …   Financial and business terms

  • share capital — That part of the capital of a company received from its owners (i. e. its members or shareholders) in return for shares Every company must commence with some share capital (a minimum of two shares). See authorized share capital; called up share… …   Big dictionary of business and management

  • share capital — That part of the finance of a company received from its owners (i.e. its members or shareholders) in exchange for shares. See also: authorized share capital, called up share capital, issued share capital, paid up share capital …   Accounting dictionary

  • share capital — N UNCOUNT A company s share capital is the money that shareholders invest in order to start or expand the business. [BUSINESS] The bank has a share capital of almost 100 million dollars …   English dictionary

  • share capital — /ˈʃɛə kæpətl/ (say shair kapuhtl) noun capital for the financing of a company to be raised by the issue of shares. See authorised capital, issued capital, paid up capital …   Australian English dictionary

  • share capital — Fin the amount of capital that a company raises by issuing shares …   The ultimate business dictionary

  • share capital — total face value of a company s shares …   English contemporary dictionary


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