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________ means any offer of securities to a select group of persons by a company other than by way of public offer.
- a)Private placement
- b)Sweat equity shares
- c)ESOP
- d)None of the above
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
________ means any offer of securities to a select group of persons by...
Private Placement
Private placement refers to the process of offering securities to a select group of investors without making a public offering. This method allows companies to raise capital without having to go through the extensive regulatory requirements that come with a public offering.
Benefits of Private Placement:
1. Limited Regulatory Requirements: Private placements involve fewer regulatory requirements compared to public offerings, making the process quicker and less costly.
2. Selective Investors: Companies can choose specific investors to participate in the private placement, allowing for more control over who holds their securities.
3. Flexibility: Private placements offer more flexibility in terms of pricing, structure, and timing compared to public offerings.
4. Confidentiality: Since private placements are not publicized, companies can maintain a higher level of confidentiality.
Difference between Private Placement and Public Offering:
- In a private placement, securities are offered to a select group of investors, while a public offering involves selling securities to the general public.
- Private placements are not registered with regulatory authorities, while public offerings require registration with the Securities and Exchange Commission (SEC) or other regulatory bodies.
- Private placements are typically used by small and medium-sized companies, while public offerings are more common among large corporations.
Overall, private placement is a useful method for companies looking to raise capital from a specific group of investors while avoiding the extensive regulatory requirements associated with public offerings.
Private placement refers to the process of offering securities to a select group of investors without making a public offering. This method allows companies to raise capital without having to go through the extensive regulatory requirements that come with a public offering.
Benefits of Private Placement:
1. Limited Regulatory Requirements: Private placements involve fewer regulatory requirements compared to public offerings, making the process quicker and less costly.
2. Selective Investors: Companies can choose specific investors to participate in the private placement, allowing for more control over who holds their securities.
3. Flexibility: Private placements offer more flexibility in terms of pricing, structure, and timing compared to public offerings.
4. Confidentiality: Since private placements are not publicized, companies can maintain a higher level of confidentiality.
Difference between Private Placement and Public Offering:
- In a private placement, securities are offered to a select group of investors, while a public offering involves selling securities to the general public.
- Private placements are not registered with regulatory authorities, while public offerings require registration with the Securities and Exchange Commission (SEC) or other regulatory bodies.
- Private placements are typically used by small and medium-sized companies, while public offerings are more common among large corporations.
Overall, private placement is a useful method for companies looking to raise capital from a specific group of investors while avoiding the extensive regulatory requirements associated with public offerings.
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________ means any offer of securities to a select group of persons by a company other than by way of public offer.a)Private placementb)Sweat equity sharesc)ESOPd)None of the aboveCorrect answer is option 'A'. Can you explain this answer?
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