Explore BrainMass
Share

Costs and risks of each type of IPO

This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

An IPO for Skype?

The online auction giant E-Bay has announced their intention to sell their Skype division through an initial public offering (IPO). Some of you might be familiar with Skype, as they are one of the leaders in providing online video and audio conferencing services. Here is an article on this recent announcement by E-Bay:

http://files.shareholder.com/downloads/ebay/676142613x0x287046/ 95ba0c30-057d-4a67-859c-8cac8e7be234/EBAY_News_2009_4_14_General.pdf

After doing some research both on Skype and on online auction IPOs, write a four to five page paper answering the following question:

What type of IPO should E-Bay use to take Skype public - a traditional IPO or an online auction?

Some issues to consider in answering the above question include:

A. The type of investors Skype likely to attract

B. The lessons learned from Google and Morningstar from their auction IPOs

C. Costs and risks of each type of IPO

© BrainMass Inc. brainmass.com March 21, 2019, 7:24 pm ad1c9bdddf
https://brainmass.com/business/initial-public-offering/costs-and-risks-of-each-type-of-ipo-291352

Solution Preview

An IPO for Skype?
The online auction giant E-Bay has announced their intention to sell their Skype division through an initial public offering (IPO). Some of you might be familiar with Skype, as they are one of the leaders in providing online video and audio conferencing services. Here is an article on this recent announcement by E-Bay:
http://files.shareholder.com/downloads/ebay/676142613x0x287046/ 95ba0c30-057d-4a67-859c-8cac8e7be234/EBAY_News_2009_4_14_General.pdf
After doing some research both on Skype and on online auction IPOs, write a four to five page paper answering the following question:
What type of IPO should E-Bay use to take Skype public - a traditional IPO or an online auction? Some issues to consider in answering the above question include:
A. The type of investors Skype likely to attract
B. The lessons learned from Google and Morningstar from their auction IPOs
C. Costs and risks of each type of IPO

About Ebay
EBay Inc. and its subsidiaries provide online marketplaces for the sale of goods and services, online payments services, and online communication offerings to individuals and businesses in the United States and internationally. It operates in three segments: Marketplaces, Payments, and Communications. The company was founded in 1995 and is headquartered in San Jose, California. (Yahoo, 2009)
About Skype
As per about.com, Skype is software that enables the world's conversations. Millions of individuals and businesses use Skype to make free video and voice calls, send instant messages and share files with other Skype users. Everyday, people also use Skype to make low-cost calls to landlines and mobiles.
Skype the organization
Skype was founded in 2003. It has become a leading internet telephony company. As per about.com, its responsible for 8% of global international calling minutes, and with its users making 3.1 billion minutes of calls to landlines and mobiles in the third quarter of 2009.
Skype- Future potential
Skype is a great stand-alone business with strong fundamentals and accelerating momentum," eBay President and CEO John Donahoe said in a statement. "But it's clear that Skype has limited synergies with eBay and PayPal. We ...

Solution Summary

Response discusses the costs and risks of each type of IPO

$2.19