In an
IPO, secondary shares (in contrast to
primary shares) refer to existing shares of
common stock
Common stock is a form of corporate equity ownership, a type of security. The terms voting share and ordinary share are also used frequently outside of the United States. They are known as equity shares or ordinary shares in the UK and other C ...
that are sold to investors in an offering (see
Secondary Market Offering).
The selling of these secondary shares may be from existing shareholders. Since these shares do not increase the number of total shares outstanding, the offering is referred to as
"non-dilutive" (to
EPS
An extended play (EP) is a Sound recording and reproduction, musical recording that contains more tracks than a Single (music), single but fewer than an album. Contemporary EPs generally contain up to eight tracks and have a playing time of 1 ...
).
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Retrieved December 18, 2020
References
{{DEFAULTSORT:Secondary Shares
Corporate finance
Stock market