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What Is A Private Placement Offering?

In many cases, when a business is seeking investors, it will have an initial public offering (IPO). Stocks or shares can be purchased by the public, and the company is traded on the stock market. Conversely, though, a private placement is when that company approaches pre-selected investors and offers them a chance to purchase stock. The public is not involved, and there is no IPO. Private placements still fall under SEC regulation, though it is often less strict. This process gives the company a chance to target wealthy individuals or institutions, which can sometimes be more effective than allowing the public to invest.

Here at Valenti Hanley PLLC, our attorneys have extensive experience handling investment issues and regulations by the U.S. Securities and Exchange Commission. We offer a broad range of legal services to assist our Louisville clients in this complex area of the law. With a significant amount of money on the line, the stakes are always high. That’s why it’s so helpful to have experienced advisers who can provide insights into the law. Our results-oriented team is highly skilled and diverse, with years of combined experience that can help you find the solutions you seek.

Is This A Common Practice?

Yes, private sales have become increasingly common. One reason for this is that the SEC regulations are not as strict as with an IPO. The use of private placement offerings has especially been noted in the tech sector, where many startups want to put off an IPO. Using private placements allows them to generate the capital that they need and find specific investors, but they don’t have to go through the process of taking the company public and dealing with the more extensive ramifications.

Contact Us To Learn More

If you’re interested in these more sophisticated and complex investments, it’s very important to understand exactly what legal steps to take. Our experienced Kentucky lawyers are here for you with the guidance and expertise that you need. Simply contact us at 866-617-6209 or through our online portal to set up a consultation.