Investment Theory

What effect does a reverse stock split have on the price of shares given we have 1600000 shares outstanding and the share price is 35 cents and the split is reverse 1-20 what is the final price?

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2007-07-26 19:50:13
2007-07-26 19:50:13

There will be 80000 shares (=1600000/20) at a price of 7 dollars (0.35*20). In the end the market value of the firm will be the same.

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