To determine AMCAMC's share price prior to the share repurchase, we'll follow these steps:

Step 1: Identify the total market value of the firm (pre-repurchase).

The total market value of AMCAMC is the sum of its enterprise value and excess cash. The enterprise value (EV) represents the value of the operating business, and the cash is an additional asset for shareholders.

$\text{Total Market Value (Pre-Repurchase)} = \text{Enterprise Value} + \text{Excess Cash}$

Given:

• Enterprise Value (EV) = $370 \text{ million}
• Excess Cash = $100 \text{ million}

$\text{Total Market Value (Pre-Repurchase)} = 370 + 100 = 470 \text{ million dollars}$

Step 2: Calculate the share price before the repurchase.

To find the share price, divide the total market value by the number of shares outstanding:

$\text{Share Price} = \frac{\text{Total Market Value}}{\text{Shares Outstanding}}$

Given:

• Shares Outstanding = 10 million

$\text{Share Price} = \frac{470 \text{ million}}{10 \text{ million}} = 47 \text{ dollars per share}$

Conclusion:

The share price of AMCAMC prior to the repurchase is $47.00.

Do you want further details or have any questions? Here are five follow-up questions to expand your understanding:

1. How will the share repurchase affect the remaining shareholders?
2. What happens to the enterprise value after the repurchase?
3. How does excess cash influence a company's market value?
4. Why is AMCAMC repurchasing shares instead of paying dividends?
5. What are the effects of changes in enterprise value on stock price?

Tip: Share repurchases can increase the value of remaining shares by reducing the total number of shares outstanding, leading to higher ownership for each shareholder.