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CinnoTec Takes Your Company Public!
Our pragmatic approach and unique global market perspective will concentrate your efforts on high value yielding activities.
Cinnotec helps private companies go public through a straightforward and valuable process called a Spin-off. Cinnotec reviews each private company, offering those who qualify a flexible and cost effective plan for going public.
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FAQS : GOING PUBLIC VIA SPIN-OFFS |
Why Will Public Companies Sponsor Spin-offs?
The public company sponsor usually gets 10 - 20% of the private company's stock. The public company distributes half this stock to their shareholders. By regularly paying their shareholders Spin-off stock dividends, the public company keeps their shareholders. The public company retains the other half of the private company's stock as a corporate asset. This stock enhances the net worth of the public company. The public company sponsor normally pays the cost of distributing the private company's stock to their shareholders. This makes going public a cost free service for the private company.
How Does a Spin-off Compare With an Initial Public Offering (IPO)?
For an operating company, the average cost of doing an IPO is around US $1,000,000. It takes 18 - 24 months. Over half the private companies that decide to go public with an IPO abandon the process before they become a public company. In a Spin-off, the public company sponsor pays your costs. It takes about four months for your private company to become publicly trading. If you do an IPO, you're not required to distribute any free stock to the public. However, most IPO underwriters price the IPO stock at 15% below the net worth of the company. This effectively gives the public shareholders 15% of the private company free.
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Please contact us if you are ready to go public. |
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What is s Spin-Off?
A Spin-off can be a public company. It can trade over-the-counter (OTC), if it doesn't qualify to trade on a stock exchange. A private company wishing to go public through a Spin-off will require a public company for the process. This public company will then distribute shares of the private company to their shareholders and create a spin-off entity for the process.
General costing for an Initial Public Offering (IPO) can be more than $1,000,000 USD and in most cases takes more then a year to complete. For a private operating company this can be very prohibitive. The Spin-off option proves very beneficial to private companies, saving time and money to go public.
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