Person A owns 51% of the shares of a company. Person B owns 49% and is willing to pay literally any amount of money to buy enough stock to become the majority shareholder. Person A is not willing to sell no matter what. How is the price of the stock determined?

Question

Person A owns 51% of the shares of a company. Person B owns 49% and is willing to pay literally any amount of money to buy enough stock to become the majority shareholder. Person A is not willing to sell no matter what. How is the price of the stock determined?

In: 20

Answer 1

There’s no market so there’s no price.

What you can do is still determine a “fair value” of the company (assuming you have access to their financials) and derive a fair value for the shares ( basically Equity = Enterprise Value – Net Debt)

But that’s still not the price, since there’s not market