SEC Set to Alter IPO Process

The SEC is currently accepting comments on its proposal, “Securities Offering Reform- #S7-38-04.” This proposal is set to alter the rules for IPOs. Many experts see the proposal as a step in the right direction. The proposals range from the ridiculously obvious, such as allowing underwriters to email IPO pricing information to investors, to far more reaching proposals such as allowing individual investors to listen via web cast to the “Road Show.” The “Road Show” is the presentation management puts on for institutional investors in an attempt to convince them to invest in the company. Typically management visits numerous institutional investors and presents to them the company, and answers questions.

This proposal would be a boon to the small investor, because for the first time the average investor could get a feel for management, and hear answers to questions posed by institutions willing to commit millions of dollars. It would make the IPO process much more fluid, and allow the little guy to gain access to more information regarding the company.

The following are links related to the proposed reform:

Complete SEC Proposal

Submit Comment to SEC Proposal

Cnnfn - Article on Reform

Click Comments Link below to Post Comments.