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IPO underwriting

 

Initial Public Offering (IPO) Vs Reverse Take Over (RTO)

Created by : Kundan Goswami, M & A Advisor, SBI Caps  | 08 20 2008 02:06:32 +0000
Industry : M&A/UnderwritingFunctional Area : Valuation(Corporate Finance)
Keywords : IPO Public Offering Initial Reverse RTO
Activity:  1060 views;  last activity : 07 06 2010 20:18:09 +0000
Discussion of key points of differentiation between reverse take overs (RTO) and initial public offerings (IPO).
  
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IPO Vs RTO
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An IPO favors the listing of medium to large market capitalised companies. The purpose of an IPO can be either a compliance listing with the minimal 25% free float or a larger placement to raise funds for specific growth plans.
By Kundan Goswami, M & A Advisor, SBI Caps  | 08 20 2008 02:06:32 +0000
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An RTO is often better for small to medium listings as the extensive road show marketing and underwriting fees may be avoided. It often has minimal new issuance of current and vendor shares. An RTO tends to have more certainty than an IPO for a small to medium sized market capitalized company. Often the listed shell company has nominal asset value however the shareholders and Board know of the RTO process value so usually is bought for much higher than asset value.
By Vishnu Prasad, M & A Advisor, JP MorganChase  | 08 20 2008 02:07:24 +0000
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Hey very nice article and some cool points....and the last line is too good, and thanks for sharing.....
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