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Re: Summer2762 post# 138744

Friday, 03/16/2012 2:32:07 PM

Friday, March 16, 2012 2:32:07 PM

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But what's in it for them? Their fees are constant…

An underwriter’s fee is generally based on a % of the gross proceeds, so there is a direct incentive for the underwriter, albeit a small one, to see the offering go off at a high price. Perhaps more important is the underwriter’s reputation—getting a relatively high price for the offering encourages future IB business.

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