RAISING_FUNDS_EXTERNALLY_AN_OVERVIEW_OF_INVESTMENT_BANKING__Chapter_8

RAISING_FUNDS_EXTERNALLY_AN_OVERVIEW_OF_INVESTMENT_BANKING__Chapter_8

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RAISING FUNDS EXTERNALLY: AN  OVERVIEW OF INVESTMENT  BANKING Chapter 8
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Have You Considered ….            becoming an Investment Banker???
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INVESTMENT BANKING In order to go “public” with an offering of Stock or  Bonds, you must be approved by the Securities  Exchange Commission  (SEC) in Washington - if you  are selling securities outside of your state - and/or by  the state regulatory commission of your state -  e.g., The California Department of Corporations.
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INVESTMENT BANKING The directive of the SEC is “Full disclosure” What does “Full Disclosure” mean? The directive of the California Department of Corporations is  “Fairness” California is the toughest regulator of all the states. If you sell securities only in California, you only need to register  in California - An Intra-State offering. If this is extensive,  however, it can be too much trouble someone may sell out of state!
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INVESTMENT BANKING Advantages and disadvantages of: Private placements: Speed Confidentiality Easier to change covenants More costly in terms of interest rate or stock P/E. Public offerings: Have a “public stock” for borrowing, acquisitions. Less costly in terms of  lower interest or higher P/E Slower process Loss of confidentiality  Difficult and expensive to make all the “Filings”
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INVESTMENT BANKING Two sources of external funds :  1)  Private placement 
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This note was uploaded on 05/20/2010 for the course DOF AAf001-6 taught by Professor Changchungdo during the Spring '10 term at 카이스트, 한국과학기술원.

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RAISING_FUNDS_EXTERNALLY_AN_OVERVIEW_OF_INVESTMENT_BANKING__Chapter_8

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