Note on IPO Share Allocation Case Solution And Analysis, HBR Case Study Solution & Analysis of Harvard Case Studies

Initial Public Offering (IPO) is the first sale of stock or shares to the public. IPO, often set lower, younger companies seeking capital to expand, but they can also be made by large private companies that want to go public. When a company lists its shares on a public exchange, it will almost always be an additional issue of new shares at the same time. Money paid by investors for the newly issued shares goes directly to the company (later than trading on the stock exchange in which money passes between investors). Thus, IPO gives the company access to a wide pool of stock market investors, which can provide significant capital for future growth. Instead, the company repayment of capital, the new shareholders will have the right to future profits distributed by the company and the right to the allocation of capital in the event of divorce. Once a company is listed, it may continue to issue shares, which would again give it capital to expand, with no debt. This can regularly raise large amounts of capital from the general market is a key incentive for many companies seeking to list. Additional reasons for the public include the provision of liquidity to venture capital investors, management and employees, who are usually the owners of stock options. In addition, through the IPO, the company gets the prestige of the world with customers, suppliers, and within their local community and business. "Hide
by Mark Leslie, Michael Marks, Claire Magat Raffaelli 6 pages. Publication Date: February 17, 2010. Prod. #: E377-PDF-ENG