What are Private Shares?

By QuickBooks Canada Team

0 min read

Private shares of stock are issuances of equity in a company that is not publicly listed on a stock exchange. Anyone can own private shares, although the stock must be purchased directly from the issuing company. In addition, private shares are typically only bought during capital funding ventures and purchased in large quantities. Private stock can typically only be sold back to the issuing company.

A private company may perform a buyback of stock to consolidate who owns the company, reduce the cost of outstanding capital, or capitalize on the belief its stock is undervalued. A major difficulty of selling private stock is valuing the equity as there is no public market that establishes the price per share.

References & Resources

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

Related Articles

What is Shareholders' Equity?

Shareholder’s equity is whatever money is left in a company after all…

Read more

Celebrating #Canada150: The Future Is Bright for Canadian Entrepreneurship

We’re at an economic crossroads in the Canadian entrepreneurial landscape. The self-employed…

Read more

What Is an Accredited Investor?

An accredited investor is an individual, entity, or financial institution with a…

Read more