Daily English 1048 - Launching an Initial Public Offering

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Dialogue/Story

Zoe: What are you looking at?

Midas: It’s the prospectus for Boogle’s IPO. I wish I could get in on the initial public offering, but since I can’t, I’ll buy stock as soon as the company becomes publicly traded.

Zoe: I’m not really familiar with how the stock market works. You mean you’re going to buy shares in Boogle?

Midas: That’s right. An IPO is a way for a privately owned company to become a publicly owned one. The owners of the company do it to raise capital, or sometimes it’s for early investors to cash in.

Zoe: Why can’t you buy stock in the initial public offering?

Midas: A company like Boogle works with an underwriter, like a major investment bank, to help set the share price and to find buyers for the initial offering.

Zoe: Okay, I’m following you so far.

Midas: Well, that first sale of stock is usually done in bulk, and I don’t have a few million dollars lying around to buy that much stock. Luckily for me, those first buyers then turn around and sell that stock in smaller amounts.

Zoe: And that’s when you’ll buy.

Midas: That’s right. You should get in on it, too.

Zoe: You mean buy some Boogle stock?

Midas: Sure, why not?

Zoe: And risk losing my shirt? No, thanks!

Category: Business


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