|
|
Corporate Finance
Working Capital
Growth Capital
Recapitalization
Refinancing
Debt Financing
Equity Financing
Equity Financing
Public Equity
Public Equity is typically raised through a going public transaction called in initial public offering or “IPO,” where shares of common stock are registered with the SEC and traded on the public stock exchanges. Being a public company offers many advantages over being private, including:
- Further Access to Growth Capital – The proceeds from a public offering may be used for such purposes as providing working capital, retiring debt, consummating acquisitions, performing research and development, building or expanding facilities, or upgrading technology. Additionally, once a company is publicly traded, it may return to the public markets to raise additional cash in secondary offerings.
- Employee Compensation – Nothing is more important to a business’s growth and success than the ability to attract, motivate, and retain talented key personnel. Once public, a company can use stock, stock options, and stock related plans as meaningful compensation and benefits for key employees.
- Liquidity for Investors – Going public provides liquidity for a company’s founders and other investors that may want to diversify their wealth or “cash out” of their investment, as the stock can be sold more easily on an open market.
- Acquisition Currency – Once public, a company obtains the ability to use unissued stock as collateral for potential acquisitions. The unissued stock has a ready public market with the benefits of liquidity and an ascertainable market value. The ability to use stock as acquisition collateral to facilitate mergers and acquisitions can offer a substantial and powerful competitive advantage.
- Improved Corporate Image – Being a public company has the effect of providing more visibility, perceived stability and enhanced stature. Public companies are typically better known, are viewed as more stable than private companies and as more attractive business partners for customers and suppliers. Lenders and suppliers also may perceive a public company to be a better credit risk than a private company, and therefore be more inclined to extend favorable terms to a public company.
The IPO process generally takes three to five months or longer, depending upon the cooperation of the markets, the complexity of the transaction, and the depth of any unforeseen hurdles.
How Atlantic American Can Help
Raising public equity presents a complex and challenging maze of obstacles and requirements, which if overcome successfully, can present powerful capital raising and wealth creation opportunities. Although we cannot consummate such transactions completely on our own, Atlantic American maintains close relationships with many of the top tier, as well as junior, Wall Street underwriters.
Atlantic American, along with its affiliates and partners, assists companies throughout the entire going public process by helping to understand and resolve complex issues, assess risk, avoid mistakes, and maximize an IPO’s probability of success.
|
 |
