General Motors

What is an initial offering An initial earth offering (initial offering) is the suppuration through which a privately held company issues sh bes of stock to the semi ordinary for the setoff time. IPOs atomic number 18 almost endlessly an opportunity for the existent investors and participating meditation capitalist to make big profits, since for the first time their sh ars allow be given a food market economic value resounding expectations for the companys upcoming growth (answers.com). IPO is overly known as freeing public and converts a little business from a privately owned and operated entity into unmatched that is owned by public stockholders. IPOs argon whole in the growth of many small businesses, beca implement it provides them with annoy to the public capital market and also increases their credibility (answers.com). Advantages and disadvantages of firing public There are many advantages of going public. They are: ? circulat ing(prenominal) stockholders potentiometer diversify.

?Liquidity is increased ?Easier to raise capital in the future ? substantiation of firm value ?Makes it more feasible to use stock as employee incentives ?Increases customer recognition The disadvantages are: ? many reports have to be filed ?operating(a) date must be give away ?Officers must disclose holdings ? particular(prenominal) deals to insiders will be more surd to undertake ?A small new issue whitethorn not be actively traded, so market-determined prices may reflect true value ?Managing investor relations is time-consuming Although, there are many advantages, there are a offspring ! of disadvantages as well. With the disadvantages, it is noted that more disclosure and paper bend is always required with a publicly held company (Brigham/ehrhardt, 789-790). The operation of going public A company cannot just decide to go public and its a done deal. There are steps required in the going public move that every company must follow. The first step is to take over an investment banker. Once the company decides to go public, it has to decide on how to sell...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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