Equity Capital Markets

Primary Offering

Definition

What is Primary Offering?

A sale of newly issued securities in which the issuer receives the proceeds.

Example in practice

A bank issues new shares to strengthen its capital base.

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The first public sale of a private company's shares, after which the shares may trade on an exchange.

A sale of existing securities by current holders, so the issuer generally does not receive the proceeds.

An additional public share sale by a company that is already listed.

An offer allowing existing shareholders to buy additional shares, usually in proportion to their holdings.

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