InvestorsHub Logo
Followers 0
Posts 12626
Boards Moderated 2
Alias Born 04/05/2006

Re: GorillaGorilla post# 7123

Thursday, 10/22/2009 11:03:14 AM

Thursday, October 22, 2009 11:03:14 AM

Post# of 94785
It wouldn't be an IPO. IPO's require underwriters and a lot more structuring. These are called DPO's "Direct Public Offerings" and do not require an underwriter as the company itself markets the securities without a broker (sometimes a broker is used). A company can also register private placement shares in what is known as a "selling stockholders" offering.

http://en.wikipedia.org/wiki/Direct_public_offering

Example 1 "Direct Public Offering"

China ACME wants to go public in the U.S. If they wish to be a U.S. Company, they will need to incorporate in the U.S. That can be done by simply Incorporating a new business entity in the States. The U.S. company would then acquire the China company. Initial equity ownerhip would be distributed.

Then the newly formed entity would undergo an audit by a PCAOB registered firm. The company would also need to prepare a Form S-1 http://en.wikipedia.org/wiki/Form_S-1

On the Form S-1 the Company would then seek to register shares from treasury in order to raise money. Once the SEC has deemed the filing effective, the Company can then begin to market it's shares through various marketing efforts.

During this period the Company would request a ticker symbol from FINRA. Once the offering closed, the Company would then locate a market maker to sponsor them for a quote on the OTCBB.

Example 2 "Selling Stockholders" offering

Instead of attempting to sell its securities directly to the public, the Company would conduct a Regulation D private offering exempt from registration.

http://en.wikipedia.org/wiki/Regulation_D

The Company could also use Regulation S which is an offering to Foreign investors.

Once the Company had completed it's unregistered, exempt offering, it would then use Form S-1 to register the shares sold to private investors. This would allow the private placement investors the ability to sell their shares. The process to obtain a ticker and become quoted would be the same in either case.






Visit our #board-9884 and come make $$money$$ with us by trading and investing in Emerging Chinese Small Caps!

Join the InvestorsHub Community

Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.