underwriting spread


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Underwriting spread

The income that is generated by the underwriting syndicate and the selling group, which is essentially the difference between the amount paid to the issuer of securities in a primary distribution and the public offering price.

Gross Spread

In a public offering, the difference between the price an underwriter pays an issuer and the price at which it sells the offering to the public. That is, an underwriter pays the issuer an agreed-upon price to purchase an issue, which it then attempts to place with investors. When it places the issue, it charges the investor a certain price like any other trade. The difference is known as the gross spread; it forms the bulk of an underwriting firm's profits. See also: Fully subscribed, Overbooked, Underbooked.

underwriting spread

See gross spread.
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The company said that its investment adviser will bear all of the gross underwriting spread and pay the underwriters an additional supplemental payment of about USD0.
TriplePoint Venture Growth prices public offering of 6.5m common stock
Identify the components of underwriting spread including take-down, commissions, risk, expenses and management fees.
Provision of Underwriting Service
Underwriters are compensated in the form of an underwriting spread, or a discount from the face amount of the bonds.
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90 per share or the price received by Minorco in the secondary offering less the underwriting spread, whichever is lower.
Engelhard to Purchase Up to 13.9% of Its Shares; Remainder of Minorco Stake to be Sold in Public Offering
1,2) Yet, a major source of underwriter revenue lies in the underwriting spread, which in a firm commitment offering is the difference between the price paid for the issue by investors and the price paid to the issuer divided by the issue proceeds.
Are initial returns and underwriting spreads in equity issues complements or substitutes?
Market competition has allowed issuers to compress the underwriting spread on their deals so low that broker-dealers are pricing primary deals at a wholesale level and thus selling almost exclusively to wholesale buyers.
The path to bond market efficiency: how increased retail distribution can lower borrowing costs
Third, underwriting expenses (both the underwriting spread and the other expenses of issuing equity) are negatively related to management quality and reputation.
Management quality and equity issue characteristics: a comparison of SEOs and IPOs
Moreover, national statistics showed that the average gross underwriting spread--that is, the underwriter's compensation for purchasing bonds--of bonds offered through negotiated sale was higher than the average gross underwriting spread of bonds offered using the competitive sale method.
Passion in public finance: the debate over competitive vs. negotiated underwriting
This paper focuses on the measurement of underwriting spread effects for information costs, for bonds with structural or tax complexity, and for bonds containing equity-conversion options or bond-put options.
An explanation of underwriting spread differentials on complex securities
1998) and to lower underwriting spreads and offering yields for nonconvertible debt issues (Miles and Miller, 2000).
Co-managers, information, and the secondary market liquidity of initial public offerings
Little money can be made as a co-manager in the current market because underwriting spreads are usually so slim.
The tough get going
Erdman's hero quickly realizes that rating fees and municipal underwriting spreads offer little opportunity for a return to the high profit margins of his leveraged-buyout days.
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