"Shareholder dilution" refers to a decrease in the ownership percentage of existing shareholders in a company due to the issuance of new shares. It happens when a company raises additional capital by selling new shares, which increases the total number of shares in circulation. As a result, existing shareholders' ownership stake in the company gets reduced since their shares represent a smaller portion of the overall ownership.
Full definition
It used the muted shareholder reaction to the transaction as a pressure point, highlighting opportunity its own bid gave for liquidity
without shareholder dilution.
The opportunity for shareholders here lies in these companies maintaining or increasing their dividend payout while pledging share buybacks to
offset shareholder dilution that occurred during the slump.
He encounters the question of this
ongoing shareholder dilution more frequently on these calls, but always sidesteps a true response to shareholder concerns.
That's not chopped liver in this era of deposit rates below 1 %, but it also doesn't pay for the risk of another market meltdown, bank bailout, and
accompanied shareholder dilution.
I think I described it as «bone - headed»... But when debt's a problem, most directors show little concern
for shareholder dilution — they'll issue additional equity at whatever price the market will bear.
That means more debt or
shareholder dilution to encourage growth.