The following is an example of seasoned offerings:Multiple choice question.an IPOdebt issuesecondary offeringprivate purchase agreement
Question
The following is an example of seasoned offerings:
- a. IPO
- b. debt issue
- c. secondary offering
- d. private purchase agreement
Solution
Understanding Seasoned Offerings
In finance, seasoned offerings refer to the issuance of new shares by a company that has already gone public and is trading on a stock exchange. This includes different types of offerings alternative to the initial public offering (IPO).
Analyzing the Options
-
IPO: This is the first sale of shares by a private company to the public. Since the company is already public to be considered seasoned, this option does not apply.
-
Debt Issue: This refers to a company raising capital by issuing bonds or other forms of debt securities. This is not considered a seasoned offering as it doesn't pertain to equity sales.
-
Secondary Offering: This occurs when a company that already has shares publicly traded issues additional shares. This is a characteristic of seasoned offerings as it relates specifically to existing public companies raising additional equity.
-
Private Purchase Agreement: This typically involves private placement of shares and is not relevant to seasoned offerings since it doesn't include public trading.
Final Answer
The correct answer to the question regarding seasoned offerings is secondary offering.
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