Question

How successful was the IPO in raising capital? How much capital did the IPO raise? How is the company investing the funds from the IPO?

information about google inc. company

Answer 1

Answer:

The IPO of Internet search engine Google wasn't one of the biggest IPOs ever, but it was a media sensation. While many aspects of Google's IPO were standard, it differed in some important ways. Also, Google made some mistakes that affected its IPO.

The biggest difference was in the way Google chose to allocate shares. Instead of letting the underwriter dish out shares to favored institutions, Google held a Dutch auction in which everyone who wanted a share put in a bid. The lowest successful bid became the price that everyone got their shares at, even if they bid a higher amount. This method guarantees that the initial offering price is set to sell all of the shares at a price that conservatively reflects market demand.Google’s IPO was unconventional, starting with a registration statement stating that the company was planning to raise $2,718,281,828.Google bargained with its investment bankers to lower the fees that are charged, and paid 2.8% rather than the more normal 4% that a multi-billion dollar deal would normally face. Most IPOs, and almost all of those that raise $50-200 million, pay their bankers 7% of the proceeds.A bank or group of banks put up the money to fund the IPO and 'buys' the shares of the company before they are actually listed on a stock exchange. The banks make their profit on the difference in price between what they paid before the IPO and when the shares are officially offered to the public.