3/9/2023 0 Comments Spotify stock value![]() Offer greater liquidity for its existing shareholders, without raising capital itself and without the restrictions imposed by standard lock-up agreements.When Spotify came to Latham in May of 2017 with its goal of becoming a publicly traded company, it also wanted to achieve a number of other important objectives that did not necessarily align well with a traditional US IPO process. ![]() This means that certain features that are typical of a traditional IPO-such as lock-up agreements and price stabilization activities-are not present in a direct listing. Since there is no underwritten offering, a direct listing does not require the participation of underwriters. Existing shareholders, such as employees and early-stage investors, become free to sell their shares on the stock exchange, but are not obligated to do so. In a direct listing, a company’s outstanding shares are listed on a stock exchange without either a primary or secondary underwritten offering. Latham represented Spotify in the direct listing, and in this case study Latham lawyers and Spotify’s General Counsel, Horacio Gutierrez, provide a behind-the-scenes look at the transaction, including why Spotify chose to pursue a direct listing, the path to a direct listing, and the challenges encountered along the way. ![]() Since Spotify first announced its intention to become a public company using this groundbreaking and innovative structure, it has generated enormous interest from the financial press and market participants. If Spotify’s direct listing were a song, it would surely be at the top of the Today’s Top Hits playlist for 2018. ![]() Spotify had a number of important goals that it wanted to achieve along with going public, and a direct listing enabled it to do so. ![]()
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