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Initial Public Offering .

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Describe the financing issues that an organization faces when it goes public.

1) The impact on ownership control and return

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Solution Summary

A description of financing issues an organization faces when it goes public and the impact on ownership control and return is given.

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Overview of IPO

IPO is an Initial Public offer to an investor, which mean it is the first issue of equities by the company to the general public at large. Among the most popular reasons a company might choose to go public are to: raise capital to expand its business, finance acquisitions, pay debt and have greater and easier access to capital in the future. Thus financing issue is how much to raise the funds from the equity offer. Public companies have thousands of shareholders and are subject to strict rules and regulations. They must have a board of directors and they must report financial information every quarter. In the United States, public companies report to the SEC.

Impact on ownership control and return

It dilute the ownership control as the ...

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