On: Apple Announces Plans to Initiate Dividend and Sha...

[padobson]

I just want to point out that the amount of cash it takes to take a public company private is not equal to Shares * Market Price.

It's actually Float Shares * Market Price.

This doesn't make much of a difference in Apple's case, because most of their market share is floating on the public market. Quick calculations:

932.37M Shares Outstanding x ~$600/share = $559.4B Mkt Cap

931.79M Float Shares x ~$600/share = $559.0B Price to go Private

$400mm, in this case, doesn't make much of a difference, but if you talk about this for other companies in the future, keep it in mind.

Source: http://finance.yahoo.com/q/ks?s=AAPL+Key+Statistics

[ChuckMcM → padobson]

But you only have to have 50.1% of the shares to force the other 49.9% to let you go private :-)

[SoftwareMaven → ChuckMcM]

Serious question: wouldn't the SEC say "no way" if that 49.9% constituted more than 500 (at least, I believe that's the number) people?

[raldi → SoftwareMaven]

No, they'd just require the private company to disclose the same sort of quarterly information that a public company does.

You're clearly alluding to Facebook being "forced" to go public, but they too could remain private with 501 investors. But once they're revealing their numbers, they figured they might as well jump in with both feet and do the IPO.

[stevewilhelm → SoftwareMaven]

Typically when a company goes private, it buys back the shares from the current shareholders. The number of shareholders would then drop back under 500.

[msellout → SoftwareMaven]

Yes.

if (NumOwners >= 500) public = true;

[grinich → msellout]

Actually, I think the rule is >500 investors, you have to publicly disclose financials a la Sarbanes–Oxley Act.

Different than being a publicly traded company.

[stevewilhelm → padobson]

You omitted the premium shareholders would want from Apple to agree to sell their shares back to the company.