Floating an issue


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New Issue

Any offering of stock by a publicly-traded company. If it is the first such offering, it is called an initial public offering (IPO); otherwise, it is called a follow-on offering. A company makes a new issue through underwriters, who have the responsibility to place the offering with individual and institutional investors. Companies make new issues in order to raise financing for expanded operations, or because they have become cash poor and need to finance their current operations. The offerings themselves give investors a portion of ownership in the company issuing them.

Floating an issue.

When a corporation or public agency offers new stocks or bonds to the public, making the offering is called floating an issue.

In the case of stocks, the securities may be an initial public offering (IPO) or additional issues of a company that has already gone public. In that case, they're called secondary offerings.

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