Negotiated Underwriting

Negotiated Underwriting

A process in which both the purchase price and the offering price for a new issue are negotiated between the issuer and a single underwriter.

Notes:

The underwriter pays the issuer a purchase price, and the public pays the offering price. The spread between the purchase price and the public offering price represents the proceeds to the underwriter.

See also: Competitive Bid, Initial Public Offering - IPO, Issuer, New Issue, Public Offering Price - POP, Underwriting

---

Negotiated underwriting

A securities offering process in which the purchase price paid to the issuer and the public offering price are determined by negotiation rather than through competitive bidding.