An initial public offering (IPO) is when a private company goes public offering its shares for sale to the general public. Twitter went public on the 7 th of November 2013 via a company tweet. Twitter held one of the most high profile IPOs in recent history. Its selling price was at $26 a share. That IPO price values Twitter at 14.2 Billion dollars.
Goldman Sachs was Twitters lead underwriter. Goldman Sachs is a leading investment bank that offers; investment services, brokerage, underwriting and securities. Underwriting is a vital function of the financial world. This is when an individual or institution takes on the financial risks associated with a venture, loan or investment. In this case Goldman Sachs entered into a contract with Twitter; after which it approaches different perspective investors with offers to sell its shares. Goldman Sachs and the other underwriters stood to gain a substantial fee from managing this sale.
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Twitter sold 70 million shares hoping to raise $1.8 billion at $26 per share.
