Multiple Capital Structure

外汇网2021-06-19 13:36:27 170

The classification of a company's stock and bond offerings into different classes. Each class will have different characteristics in order to meet the needs of a wider range of investors than would be possible by issuing just one class of stock. The inpidual components have varying required rates of return affecting the weighted average cost of capital.

Taobiz explains Multiple Capital Structure

For example, Berkshire Hathaway's common stock is pided into class A and class B shares. The class A shares (BRK.A) have more voting rights and can be converted to class B shares. The class B shares (BRK.B) have fewer voting rights and cannot be converted to class A shares. Class A shareholders have 0.5% of the voting rights that B shareholder do.

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