What is a Share Split?
Definition
- A share split refers to dividing existing shares into a larger number of shares
- The total value of the shares remains unchanged
How It Works (Example)
- Before: 1 share = RM10
- After: 5 shares = RM2 each
- The total value remains RM10 (no change)
Key Features
- A share split is not the same as issuing new shares
- It only divides existing shares to increase the number of outstanding shares
Impact
- The company’s Paid-Up Capital remains unchanged
- The company’s overall value remains unchanged
- The share price decreases, but the total value of shares remains the same
- Shareholders’ ownership and rights are not affected