6885-15-7P AID: 63238 | 21/05/2020

A company can either have an All-Equity structure or Debt-Equity structure. A share re-
purchase or buyback decision is taken by a company when there is a bull market and the
company wants to boost the financials using the value of the share.
In order to find the value per share of the equity we will find the repurchase price of the
shares and divide it by the number of shares repurchased.

In order to find the value per share of the equity in Plan I and Plan II we will find the
repurchase price of the shares and divide it by the number of shares repurchased.

Drawing comparison between Plan I and All-Equity Plan, 300 stocks can be repurchased
using $ 16,500 amount.

So, under Plan I value per share is

16,500
PI =$
300
=$ 55

Similarly, under Plan II comparing with All-Equity Plan, 500 stocks can be repurchased by
using $ 27,500 amount

27500
PII =$
500
=$ 55

PI =PII =$ 55
Value per share of equity is