One-Stop Service for the Approach That Works Best for Your Company
At Gottbetter & Partners, our corporate finance attorneys work with companies interested in becoming publicly traded through any of several approaches: initial public offering (IPO), alternative public offering (APO), or our own proprietary method, a self-underwritten public offering called a Gottbetter Public Offering™ (GPO). Each approach has its advantages and disadvantages, and we work closely with each client to make sure that the pros and cons, timing and expense of each option are clearly understood.
Whichever way you choose to go public through a securities offering, you can depend on G&P for comprehensive client service at every stage of the process, including setting forth timelines and deliverables and managing the process. You will also have the support of an experienced team that delivers seamless service through our network of accountants, auditors, underwriters, transfer agents and market makers — all part of the one-stop service our firm offers clients who want their shares trading in public markets.
Initial Public Offerings for Larger Private Companies
Going public through an IPO often makes sense for larger private companies focused on raising capital while improving the liquidity of their shares, attracting attention in the market and broadening their equity base. The challenges of making an IPO work simultaneously across several fronts — management, accounting, legal, regulatory and underwriting — tend to make this approach more expensive and time-consuming than other routes to public trading. Moreover, many companies will simply be too small to attract the underwriting interest necessary to make the IPO work.
Alternative Public Offerings Through Reverse Mergers and PIPES
Companies capitalized at less than $50 million might prefer an APO to the more complex IPO as a way to go public. An alternative public offering represents a combination of a reverse merger with a PIPE transaction, or private investment in a public entity. The private company merges with a public shell, a company that no longer has a business, assets or liabilities, but the stock of which is still eligible for public trading and which is still filing reports with the SEC. At the same time, the combined company sells its stock, typically with restrictions, to investors in a privately negotiated sale, often with the assistance of one or more investment banks working as placement agents. The APO is substantially faster, since there is no SEC review process prior to "going public", and less expensive than an IPO, and can usually close in 90 days, as opposed to the nine to 12 month lead time for an IPO.
APO transactions have disadvantages, too: It takes time to remove the restrictions on transfer of the company's unregistered shares, and the after-market necessary to support true liquidity for the securities might take most of a year to develop. As a result, the share price negotiated for private investors in the PIPE transaction will typically reflect a significant discount to a company's desired valuation.
G&P's Adam Gottbetter discusses the 2011 outlook for APO transactions with other industry professionals in an online Financier Worldwide TalkingPoint discussion.
Self-Underwritten Public Offerings Through the GPO
G&P's own proprietary method of taking a company public, the Gottbetter Public Offering™ (GPO), leverages our firm's experience and valuable network of collaborating partners throughout the financial community to help companies achieve many of the advantages of an APO without the risk and expense of acquiring a shell corporation for the reverse merger. Our attorneys take care of each step necessary to complete a GPO, from initial organization and SEC registration to arranging such financing options as private placement offerings. By working on the SEC registration, FINRA filing and Standard & Poor listing at the same time, G&P can usually complete the going public process in about 180 days at considerable savings over an IPO and APO.
To find out more about the going public options that your company can consider, contact an experienced securities lawyer at Gottbetter & Partners in New York City.
