Model who sells, where shares go and how cash affects value

Define the opening holders and cash method

The synthetic company has 100m outstanding shares: 80m public and 20m insider. Opening Equity Value is EUR 2bn, or EUR 20 per share. Enter a EUR 200m cash-method buyback at EUR 20 per share. The native transaction calculates 10m repurchased shares. There are no options or other dilutive instruments in this example.

Select the public holder as the only seller. Public ownership falls to 70m shares while the insider keeps 20m. With 90m outstanding, insider Basic ownership rises from 20% to 20 / 90 = 22.222222%. The insider has not received extra shares.

Compare pro-rata selling with selected sellers

For an all-holder pro-rata buyback, the public sells 8m and the insider 2m. Remaining holdings are 72m and 18m out of 90m. The 80% / 20% ownership split is unchanged. Holding the aggregate cash use constant does not make these two owner outcomes equivalent.

Selected-seller allocation is proportional within the selected eligible sellers when more than one is chosen. Check available holdings and the security before evaluating. The model cannot repurchase more eligible shares than exist.

Download the synthetic model, explicitly import it under Model and open Ownership → Equity Transactions in Advanced. Import creates a separate model. The calculators above do not change saved models.

Treasury and retirement change different counts

With Treasury treatment, issued shares remain 100m and treasury shares become 10m; outstanding is 90m. With retirement, issued shares become 90m and treasury is zero; outstanding is again 90m. The same seller allocation therefore gives the same Basic percentage under both treatments.

Do not subtract treasury twice or treat retirement as another cash outflow after the buyback. Keep the original repurchase cash and the count treatment separate. The downloadable retirement case reconciles the same EUR 200m outflow.

Download the synthetic model, explicitly import it under Model and open Ownership → Equity Transactions in Advanced. Import creates a separate model. The calculators above do not change saved models.

State the value treatment; do not promise accretion

With cash-adjusted valuation treatment, Equity Value falls from EUR 2bn to EUR 1.8bn. EUR 1.8bn / 90m shares remains EUR 20 per share. Buying at the modeled value has not created value here, even though a non-selling insider’s percentage rises.

The full operator also distinguishes fixed-value and ownership-only treatments. Fixed value holds the selected equity amount constant; ownership-only does not supply an equity valuation. Those choices must not be confused with a market prediction. Ownership-analysis cash is not automatically posted into the Model financial statements.

Review the synthetic transaction’s opening/closing comparison and inspect seller holdings, issued/treasury/outstanding shares, cash and valuation policy. The separate “Review closing Cap Table for application” control precedes any explicit application. Legal permissibility, tax consequences, market execution and liquidity approval remain outside this example.

Additional reconciled variants

These native files reproduce the discussed variants separately: Pro-rata sellers with retirement.

Related decisions and model reference

For adjacent questions: Issued, Outstanding and Treasury Shares: Reconcile the Counts; Cap Table Model: Build and Reconcile Ownership; Enterprise Value vs Equity Value — Reconcile the Bridge.

For the exact controls and source behavior, use Buybacks, treasury and retirement and Issued, treasury, outstanding and FD shares.