Initial public offering means that the stocks issued by a company become tradable between numerous, unspecified investors on a market established by a stock exchange.
That numerous, unspecified investors become shareholders of a company can mean the company becomes publicly-opened entity.
Initial public offering is also called IPO.
IPO preparation schedule
Merits of IPO
Increased ability of financing allows improved financial conditions and capital ratio
Increased publicity secures excellent personnel, vitalizing and strengthening the company.
Enhanced corporate image and branding invites increased business opportunities, acquisition of new customers and business expansion.
Improved infrastructures for IR requires enhanced internal management system.
Review of its corporate management leads to improved corporate infrastructure, which invites objective third-party evaluation.
Considerations about IPO
Disclosure obligation of corporate information leads to increased paperwork.
Risks of buyout and takeover can lead to shareholder-oriented management.
Increased regulations to comply with requires improved internal system.
Changes from private company to public can require awareness of its existence as social entity.
Stock exchange markets for newly-established companies in Japan
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