Business -- Corporate Finance -- Initial Public Offerings
AVG is a state-of-the-art IT security company that has been very successful, has aggressively acquired other companies, does business worldwide, and is poised to use an IPO to raise capital. There is a question about whether a traditional IPO or a nontraditional auction-based method would be the better choice for AVG. The pros and cons of traditional vs. nontraditional IPO methods will be considered, including lessons learned from the nontraditional approach used by Google and Morningstar. Finally, the lessons learned by Module 1 will be discussed and evaluated.

AVG Should Use a Traditional IPO Instead of an Online Auction.

AVG is an IT security company for consumers that has taken over a number of other companies since AVG started in 1991 (AVG Technologies, 2013). AVG announced an IPO of 8 million ordinary shares (with 50% from the company and 50% from shareholders) at $16.00 per…...

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References

AVG Technologies. (2012, February 1). AVG Technologies N.V. Prices Initial Public Offering . Retrieved on November 23, 2013 from mediacenter.avg.com Web site:  http://mediacenter.avg.com/content/mediacenter/en/news/avg-prices-initial-public-offering 

AVG Technologies. (2013). AVG - Security Technology | History. Retrieved on November 23, 2013 from investors.avg.com Web site:  http://investors.avg.com/phoenix.zhtml?c=250967&p=irol-history 

Carter Chalk, A. (2005, January 9). Morningstar follows Google's lead. Retrieved on November 23, 2013 from www.businessweek.com:  http://www.businessweek.com/stories/2005-01-09/morningstar-follows-googles-lead 

Clinton, L. (2011). Traditional IPO vs. auction-based IPO. Retrieved on November 23, 2013 from www.essortment.com: http://www.essortment.com/traditional-ipo-vs.-auction-based-ipo-24886.html

Google and the IPO Process:
Google's initial public offering or "IPO" is undoubtedly one of the hottest topics of the day. Like many initial offerings springing from well-known and successful companies, many investors harbor great optimism regarding the potential of the company in the IPO phase. However, like most initial offerings, Google's endeavor is full of several complex, unusual, and uncertain factors. Be that as it may, one must begin with the "facts."

Google's IPO date was on the 19th of August, 2004, and was started at a price of $85, significantly lower than its previously projected low price of $108. Interestingly, Google choose to use an innovative way of offering the sale to the public via "modified Dutch Auction," in which 19,605,052 shares were offered at a value of $1.67 billion, with an initial market cap of $23.1 billion (About, 2004)

Financial Management Strategies and a Break with Convention:

Ah, yes. ho doesn't…...

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Works Cited

About.com. (2004).Google IPO Overview. Retrieved on September 3, 2004, from, http://stocks.about.com/gi/dynamic/offsite.htm?site=http://www.google%2Dipo.com/

Gillmor, Dan. (2004). Naysayers are wrong: Google IPO was a success. Retrieved on September 3, 2004, from,  http://www.siliconvalley.com/mld/siliconvalley/9449507.htm 

La Monica, Paul R. (2004). Google IPO: Not Feeling Lucky

TECH INVESTOR. August 12.

Business -- Corporate Finance -- IPO for AVG
hat type of IPO should AVG use -- a traditional IPO or an online auction? Based on your analysis and findings, what would you recommend to the executives of AVG? Explain your reasoning in detail.

AVG Technologies N.V. is a "consumer-focused IT security" company seeking to "simplify, optimize and secure" the Internet for its users (AVG Technologies, 2013). Founded in 1991 and based in Amsterdam, AVG has aggressively acquiring other companies such as Ewido, Exploit Prevention Labs, Sana Security, Visionize, DroidSecurity, TuneUp, Bsecure, Ookla, and OpenInstall (AVG Technologies, 2013). On February 1, 2012, AVG announced its IPO of 8 million ordinary shares -- 4 million from the company and 4 million from shareholders - @ $16.00/share, to begin trading on the NYSE on February 2, 2012 (AVG Technologies, 2012). Following SEC procedures, AVG filed a Registration Statement with the SEC, which the SEC declared…...

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Works Cited

AVG Technologies. (2012, February 1). AVG Technologies N.V. Prices Initial Public Offering . Retrieved October 19, 2013 from mediacenter.avg.com Web site:  http://mediacenter.avg.com/content/mediacenter/en/news/avg-prices-initial-public-offering 

AVG Technologies. (2013). AVG - Security Technology | History. Retrieved October 19, 2013 from investors.avg.com Web site:  http://investors.avg.com/phoenix.zhtml?c=250967&p=irol-history 

Carter Chalk, A. (2005, January 9). Morningstar follows Google's lead. Retrieved October 19, 2013 from www.businessweek.com:  http://www.businessweek.com/stories/2005-01-09/morningstar-follows-googles-lead 

Clinton, L. (2011). Traditional IPO vs. auction-based IPO. Retrieved October 19, 2013 from www.essortment.com: http://www.essortment.com/traditional-ipo-vs.-auction-based-ipo-24886.html

1. Executive Summary EbonyLife Network is going public on the Nigerian Stock Exchange. EbonyLife has been a private company since 2013, but has quickly risen to the top of the Nigerian entertainment market by offering top-notch entertainment, stellar streaming services, critically- and internationally-acclaimed, in-house produced films, and a variety of shows in a range of genres for all demographics. Now EbonyLife Network is giving investors the opportunity to stake a claim in the company’s success and in its future with an initial public offering (IPO). The company seeks to raise $500 million in capital to fund its expansion, as it seeks to grow into commercial centers, develop state-of-the-art luxury cinemas, and bring the latest in technology to its fans—including the Amazon Box with WiFi stick and EbonyLife ON. This information memo provides data on EbonyLife, its products and services, its target market, its revenue and employee profile, and how it plans…...

Business -- Corporate Finance -- IPO Facebook
Provide a brief description of the company you chose, its main business and operational activities and a short synopsis of the main developments of the company over the past few years

Facebook, Inc. is a global social networking company building and employing tools and applications for communication among its users on computers and mobile devices. Incorporated in 2004, Facebook, Inc. has approximately 5,299 employees and more than 1.06 billion monthly active users on its web site: http://www.facebook.com. Its corporate headquarters are located in Menlo Park, CA and its corporate staff consists of: Mr. Mark Zuckerberg, Founder, Chairman and Chief Exec. Officer; Mr. David A. Ebersman, Chief Financial Officer; Ms. Sheryl K. Sandberg, Chief Operating Officer and Director; Mr. Michael Schroepfer, Chief Technology Officer and VP of Engineering; and Mr. David B. Fischer, VP of Marketing and Bus. Partnerships.

Facebook, Inc. is a publicly traded corporation with…...

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Works Cited

De la Merced, M.J. (2012, May 18). Facebook Closes at $38.23, Nearly Flat on Day. Retrieved October 19, 2013 from dealbook.nytimes.com Web site:  http://dealbook.nytimes.com/2012/05/18/facebook-opens-at-42-05-in-debut-but-falls-quickly/?hp&_r=0 

Facebook, Inc. (2012, February 1). Registration Statement on Form S-1. Retrieved October 19, 2013 from www.sec.gov Web site:  http://www.sec.gov/Archives/edgar/data/1326801/000119312512034517/d287954ds1.htm 

Forbes.com, LLC. (2013). Mark Zuckerberg. Retrieved October 19, 2013 from www.forbes.com Web site:  http://www.forbes.com/search/?q=Zuckerberg 

Oran, O., & Barr, A. (2012, May 17). Facebook prices at top of range in landmark IPO. Retrieved October 19, 2013 from www.reuters.com Web site:  http://www.reuters.com/article/2012/05/17/us-facebook-idUSBRE84G14Q20120517

Corporations Law
Initial Public Offerings (IPOs) are the first time a privately held company sells its stock to the public. When such corporation needs to raise additional capital, it can either take on debt or sell partial ownership. If the corporation chooses to sell ownership to the public, it engages in an IPO

(Initial Public Offerings, 2011, p. 1). Although it is difficult to get on the ground floor of an IPO for small private investors there are still ways that these individual investors can make money on the IPO market because full-service and online brokerages are increasingly offering IPO shares to their customers reducing their financial risk of investing (Initial Public Offerings, 2011, p. 1).

Despite this apparent benefit, there are also many drawbacks linked to an IPO. A large drawback to going public is that the current owners of the privately held corporation losses a part of their ownership. Corporations [will…...

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References

Berry A.W. 2009. Advantages and disadvantages of acquisitions and mergers. 1-3.

Accessed 29 March 2012.

Personal Finance > Investing > Stock Market>

Cox J.D. & Hazen, T.L., 2nd edition 2003. Corporations. New York: Aspen Publishers.

Google had reported profits of $191 million, while Amazon reported losses. Obviously, the difference in share attractiveness that resulted from this financial fact was clearly in favour of Google's eventual share growth.
Basically, we can conclude that Google was at the right moment for an IPO and, additionally, the company was clearly much healthier and more prepared to have a significant subsequent share growth.

Bibliography

1. Reeves, Scott. IPO Outlook - Google's Flub, Flop and Bomb. Forbes.com. September 2004. On the Internet at http://www.forbes.com/home/strategies/2004/09/17/cx_sr_0917ipooutlook.html.Last retrieved on July 06, 2007

2. Befumo, R. (1997, May 1). Amazon.com Debuts. The Motley Fool. Retrieved August 2, 2006, at http://www.fool.com/Features/1997/sp9701aAmazonDebuts.htm

3. IPOGoogle.org. (n.d.) the Google Initial Public Offering: August 13th, 2004. Retrieved August 2, 2006, at http://www.ipogoogle.org/

4. Salkever, a. (2004, May 3). The How and Why of Google's Auction. Business Week Online. Retrieved August 2, 2006, from http://www.businessweek.com/technology/content/may2004/tc200403_9962_tc024.htm

. Watson, J. (2001, February 19). The Discounters. Forbes Retrieved August…...

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5. Watson, J. (2001, February 19). The Discounters. Forbes Retrieved August 25, 2006, at  http://www.forbes.com/2001/02/16/0219iporetail.html 

Befumo, R. (1997, May 15). Amazon.com Debuts. The Motley Fool. Retrieved August 25, 2006, at   retrieved on July 06, 2007http://www.fool.com/Features/1997/sp970515aAmazonDebuts.htm .Last

Reeves, Scott. IPO Outlook - Google's Flub, Flop and Bomb. Forbes.com. September 2004. On the Internet at   retrieved on July 06, 2007http://www.forbes.com/home/strategies/2004/09/17/cx_sr_0917ipooutlook.html.Last 

IPO for AVG?
An Initial Public Offering (IPO) is described as the first sale of stock by a company that seeks for further growth. IPO is commonly used by such companies in order to generate necessary capital for expansion. AVG is an example of a company looking for further growth through an initial public offering since the firm is uniquely positioned to lead innovation in the industry. While the company announced filing for proposed initial public offering in 2012, the main concern is whether to use the traditional IPO approach or an untraditional one. It's still unclear which approach AVG will use because of its global online audience and untraditional business model. Even though the traditional IPO approach has commonly been used in the past, the untraditional method or online auction was a process that emerged through Google and Morningstar initial public offerings. The determination of the most appropriate IPO…...

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References:

"AVG Technologies Announces Filing for Proposed Initial Public Offering." (2012, January 13).

PR Newswire -- A UBM PLC Company. Retrieved August 24, 2013, from  http://www.prnewswire.com/news-releases/avg-technologies-announces-filing-for-proposed-initial-public-offering-137268478.html 

Hensel, N. (2005, April 11). Are Dutch Auctions Right for Your IPO? Retrieved from Harvard

Business School website:  http://hbswk.hbs.edu/archive/4747.html

Business -- Corporate Finance -- IPO SLP
Facebook, Inc. is a social networking company that engaged in a simultaneously successful and flawed IPO resulting in multiple lawsuits against the company and its underwriters. Though the IPO traded on huge volume and raised $16 billion, it also reportedly resulted in the loss of $billions to investors due to stock overvaluation and supposed mismanagement. Due to these successes and failures, Facebook, Inc.'s IPO is a success story but also a cautionary tale.

Facebook, Inc. is a social networking company that was incorporated in 2004, has more than 5,000 employees, maintains its corporate headquarters in Menlo Park, CA and has more than 1 billion monthly active users on its site: http://www.facebook.com. It is a publicly traded corporation on the Nasdaq 100 and AMEX and its current stock price is $46.26 as of November 22, 2013 at 7:53PM EST (Yahoo, Inc., 2013). Facebook's Sales/evenue and Profitability…...

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References

Facebook, Inc. (2012, February 1). Registration Statement on Form S-1. Retrieved on November 23, 2013 from www.sec.gov Web site:  http://www.sec.gov/Archives/edgar/data/1326801/000119312512034517/d287954ds1.htm 

Forbes.com, LLC. (2013). Mark Zuckerberg. Retrieved on November 23, 2013 from www.forbes.com Web site:  http://www.forbes.com/search/?q=Zuckerberg 

Tsukayama, H. (2012, June 15). Facebook moves to consolidate cases. Retrieved on November 23, 2013 from www.washingtonpost.com Web site:  http://www.washingtonpost.com/business/technology/facebook-moves-to-consolidate-cases/2012/06/15/gJQAry7SfV_story.html 

Yahoo, Inc. (2013, October 19). Facebook, Inc. - Balance Sheet. Retrieved on November 23, 2013 from Finance.yahoo.com Web site:  http://finance.yahoo.com/q/bs?s=FB+Balance+Sheet&annual

Public Offering
One of the most common challenges that firms will face is taking a company public. This is because the timing must be right and there needs to be clear objectives as to where new investment capital will be utilized. Those firms that are taking these factors into account will have a more successful initial public offering (IPO). In the case of Avaya, the company is considering an IPO in the near future. However, there are challenges in determining what tactics should be utilized to attract the most interest. To decide this requires examining: the type of investors that Avaya is trying to draw, the lesson learned from the Google / Morningstar IPOs, the advantages of each type and the costs / risks. Together, these different elements will provide the greatest insights as to how Avaya should go public.

The type of investors Avaya is likely to attract

The type of…...

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References

Hot Issue. (2012). Investopedia. Retrieved from:  http://www.investopedia.com/terms/h/hotissue.asp#axzz1pxFFOPLB 

Traditional IPOs vs. Auction-Based IPOs. (2011), Im Invest. Retrieved from:  http://www.iminvest.com/traditional-ipos-vs.-auction-based-ipos/ 

Traditional IPOs vs. Auction-Based IPOs. (2012). Esortment.com. Retrieved from: http://www.essortment.com/traditional-ipo-vs.-auction-based-ipo-24886.html

Carter, A. (2005). Morningstar follows Google's lead. Business Week. Retrieved from:  http://www.businessweek.com/bwdaily/dnflash/jan2005/nf20050110_8372_db035.htm

The executives at Morningstar had deliberated that their decision with a lot of people, inclusive of critical investment bankers prior to the actual offering. The minimum experience of an auction IPO companies are normally encouraging. One recent occurrence has been the recent exclusion wherein CyroCor Inc. offered shares through the auction route at $11 per share in a July auction and has lost 50% of its value since then. It follows from this that the auction route for raising capital through issue of shares does not favor every company. However, there are some positive aspects and companies must fancy the odds of auction route as the real option. All companies encounter a non-stop auction for their stock from the point they start trading in public. (Syre 2005)
Wall Street was extremely cynical as regards the Google's Dutch-auction IPO, that restricted banker's impact by opening biding to the public and fixing…...

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References

Carter, Adrienne. "Morningstar Follows Google's Lead" Business Week, 10 January, 2005.  http://www.businessweek.com/bwdaily/dnflash/jan2005/nf20050110_8372_db035.htm 

Carney, Beth. "IPOs: Going, Going.. Not so fast" Business Week, 16 August, 2005.  http://www.businessweek.com/bwdaily/dnflash/aug2005/nf20050816_5134_db016.htm 

Hensel, Nayantara. "An empirical analysis of Online Auction IPO Processes and Traditional IPO

Processes" Graduate School of Business and Public Policy U.S. Naval Postgraduate School,  http://www.efmaefm.org/0EFMAMEETINGS/EFMA%20ANNUAL%20MEETINGS/2007-Vienna/Papers/0177.pdf

To begin with, publicly owned entities according to Brigham and Ehrhardt (2010) are required to submit to SEC their annual as well as quarterly reports. As the authors' note, these reports could end up becoming a costly burden. You should therefore take into consideration reporting costs before taking Cleveland Cavaliers public. Yet another factor you should consider is the IPO cost. In the opinion of Weaver and Weston (2007), costs in this case could include accountant fees, legal fees, underwriter expenses, etc.
Secondly, Weaver and Weston (2007) point out that once an entity is taken public, the original owners have to share ownership. This according to the authors occasions some considerable loss of control. Indeed, you need to be aware that on taking Cleveland Cavaliers public, only decisions supported by a majority of shareholders will sail through irrespective of whether you (as the founder) are in favor of such decisions…...

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References

Allen, K.R. (2008). Launching New Ventures: An Entrepreneurial Approach (5th ed.). Boston, MA: Cengage Learning.

Brigham, E.F. & Ehrhardt, M.C. (2010). Financial Management Theory and Practice (13th ed.). Mason, OH: Cengage Learning.

Weaver, S.C. & Weston, J.F. (2007). Strategic Financial Management: Applications of Corporate Finance. Mason, OH: Thomson Higher Education.

Wong, G.M. (2010). Essentials of Sports Law (4th ed.). Santa Barbara, California: ABC-CLIO.

Company Public
One of the most common ways that thousands of corporations will raise additional capital to fund continued expansion is: through the public markets. This is because the various bonds, stocks and private securities offerings (private placements / limited partnerships) are helping to provide them with the added liquidity to achieve these objectives. As an increasing number of companies are turning to this option through what is known as an initial public offering (IPO). This is when a company will issue stocks, bonds or other type of securities when they are first going public. In most cases, these are new businesses that are seeing significant amounts of growth and are turning to the public markets to increase their working capital. ("Initial Public Offering," 2010) This is an important step for the organization that is being examined, as the IPO will help to increase its liquidity and provide the necessary…...

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Bibliography

Initial Public Offering. (2010). Investwords. Retrieved from:  http://www.investorwords.com/2475/Initial_Public_Offering.html 

IPO Timeline. (n.d.). E Investment Bank. Retrieved from:  http://www.einvestmentbank.com/invest_banking/doc/ipo_timeline.html 

Steps for Taking a Company Public. (2010). E How. Retrieved from: http://www.ehow.com/way_5814166_steps-taking-company-public.html

Ghosh, A. (2008). The IPO Process. Pricing and Performance. (pp. 23 -- 30). New Brunswick, NJ: Transaction Publishers.

SEO
This literature review looks at the question of SEO return characteristics of large and small firms from several different perspectives. The goal is to determine whether small firms are more effected by the equity offering than larger firms. This section examines the overall evidence for performance issues (including financial anomalies and manager performance) and whether research indicates evidence for a rational or behavioral explanation.

Financial Anomalies

A firm's success in a seasoned equity or initial public offering is determined by many factors that are seemingly disconnected, but which the research shows are interdependent. Among these are the anomalies that cannot adequately be described by rational theories of pricing. As an example, Li (2012) suggests that the cyclical nature of the economy has a far greater effect on certain types of offerings (IPOs and SEOs among them) than was previously thought. Again, the relatively unpredictable nature of firms and investors can cause problems…...

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References

Abhyankar, A., & Ho, K.-Y. (2001). Is long-horizon abnormal performance after seasoned equity offerings illusory? New evidence from the UK. Retrieved from  http://www.fin.ntu.edu.tw/~conference2002/proceding/3-1.pdf 

Brau, J.C., Brown, R.A., Osteryoung, J.S. (2004). Do venture capitalists add value to small manufacturing firms? An empirical analysis of venture and non-venture capital-backed initial public offerings. Journal of Small Business Management, 42(1).

Brau, J.C., & Osteryoung, J.S. (2001). The determinants of successful micro-IPOs: An analysis of issues made under the small corporate offering registration (SCOR) procedure. Journal of Small Business Management, 39(3).

Brav, A., Michaely, R., Roberts, M., & Zarutskie, R. (2009). Evidence on the tradeoff between risk and return for IPO and SEO firms. Financial Management, 38(2).

Public Passions
Shi Jianqiao became a media sensation in Nationalist China during the 1930s for shooting the ex-warlord Sun Chuanfang, a leading member of the Tianjin Qingxiu lay-Buddhist society (jushilin). She shot Sun three times on November 13, 1935 in prayer hall (congregation site) on Nanma Road. Although she was prosecuted for murder, the courts returned a controversial final verdict of judicial leniency, and the Nationalist (Guomindang) regime overturned this final verdict by issuing a state pardon. These events led to a public debate on the merits and demerits of filial revenge, although contemporary accounts do not examine the larger sociopolitical implications the case may have had. Shi Jianqiao represented the female assassin's singular and violent expression of filial sentiment (xiao), as well as the female warrior code of "chivalrous virtue" (xia), and helped give rise to a new communal form of ethical sentiment - "public sympathy" (tongqing). For liberal and…...

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WORKS CITED

Lean, Eugenia. Public Passions: The Trial of Shi Jianqiao and the Rise of Popular Sympathy in Republican China. Berkeley: University of California Press, 2007.