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| Home » IPO Planning, Structuring, Packaging and Management » Project Planning & Preparation |
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Project Planning & Preparation |
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When an unlisted company makes a new issue of securities or an offer for sale of its existing securities for the first time to the public it is referred to as Initial Public Offering or IPO. Once a company decides to go public through an IPO, a comprehensive project planning & preparation is required. IPOs are an important part of world economy, and since the late 18th century they have been in existence. A number of risks and hurdles are involved in the process of IPO planning. In an IPO, the issuer employs the assistance of an underwriting firm who takes charge of the project planning & preparation.
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The underwriter or the investment banker is the main person who determines the success of an IPO. The other professionals involved in the IPO Planning, Structuring, Packaging and Management include lead managers, auditors, tax planners, advisors and consultants.
There are a number of steps involved in the IPO project planning and preparation. Firstly the company that is planning an IPO has to appoint a board of directors to take care of the different business areas such as accounts, tax planning, documentation, drafting the prospectus, packaging and marketing. The underwriter plays the most important part in the project planning & preparation of an IPO. He is the person who has the right business contacts and helps in getting the company’s shares to the ideal investors. They are also involved in setting the initial stock offering price. The underwriter has a role in the prospectus drafting process where the company details are provided. Tax planning and accounts auditing are also important part of the project planning and preparation process.
In the process of project planning & preparation, a lead manager also plays an important role both in the pre and post issue process. The pre-issue functions of a Lead Manager include taking charge of the company’s management, operations, business planning and legal issues. In the post issue process the Lead Manager manages escrow accounts, intimates the allocation and dispatch of refunds to bidders, coordinate non-institutional allocation and other functions. The tax planners also have an important role in project planning & preparation of IPOs.
After the project planning & preparation of an IPO is completed, the SEC or Securities and Exchange Commission reviews the company prospectus. It is only upon the approval of the prospectus by the SEC the company can started their promotion process.
For more updates on IPO Planning, visit www.ipoplanninghub.com
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