Originally Posted by F-One
There are 1 million shares. what is the pre-tax price per share.
In an ideal world, buying one million shares for $10M is $10/share.
In the business world that works if all the shares are common shares. But some of those shares may be a different class than the other shares, with different preferences for liquidation.
One example would be the requirement that owners of preferred shares get back the money that they originally paid for their shares before anyone else gets anything, and then the preferred shareholders get an equal share (alongside the other classes of shareholders) of whatever's left.