How is investor ownership calculated



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Hi Sir, please explain how does the investors ownership reduces to 10.50% from 15% as I understand that investors ownership reduces if a company raises more money by diluiting..
Assume you are an investor and own 15% in a company. Now if the company raises more money by diluting 30% to the new shareholders, what will be your ownership in the company?

2/3

15% - Incorrect
9%
45.50%
10.50% - Correct

1 Answer(s)


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Before raising money ownership is 15%
After raising money dilution is 30% so new ownership is 15%*(1-30%) = 10.5%