Say that we have two companies, Alpha and Bravo, neither have parent companies.
Alpha wants to buy out Bravo for 30 Million. Bravo accepts. Where does that money go? If it goes to Bravo but that’s under Alpha now, wouldn’t that just be Alpha paying themselves?
In: Economics
The owner/owners of Bravo get the money. If it is privately owned by one or a few people they get all of that money. If it is publicly traded then the money is divided by the number of stock shares that exist and all of the stock holders get a payout based on the number of shares they own. Said stock holders no longer own stock as the company no longer exists as an independent entity.
It goes to Bravo’s owners. If Bravo was privately owned, the owners just got very rich. If Bravo is publicly traded, each shareholder will get $X per share, where $X is the purchase price divided by the number of shares in circulation.
It goes to the shareholders of Bravo, whether it’s a public company or privately held. It may be straight cash, shares of Alpha worth what the deal is for or a combination.
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