Management Solutions International

There are a number of reasons for going public; however, the main reason is for a company to have easier access to capital.

At MSI, we work as members of a client’s team, offering knowledge and expertise in assisting you in becoming a public company.

We recognize the power of a public company that is not available to a private company. If you are considering going public contact us to learn more.

Public Company Advantages:

• Regulatory Requirements: Gives investors greater protection.

• Mergers and Acquisitions: Public stock of a company can be used for businesses to grow through acquisitions.

• Higher Valuations: Public Companies are typically valued more than private companies are.

• Benchmark Trading Price: The trading price of a public company's stock serves as a benchmark for the offer price of other securities.

• Capital Formation: Raising capital later is typically easier because of the extra liquidity for the investors.

• Incentives: Stock options and stock incentives can be very helpful in attracting employees.

• Reduced Business Requirements: While an underwritten initial public offering requires significant earnings, the lack of earnings does not keep a private company from going public.

• Less Dilution: There is less dilution of ownership control compared to an IPO.

• Reduced Underwriter Requirements: No underwriter is needed.

• S-8: Form S-8 stock can be issued to employees and consultants by a public company.

• Liquidity: A public company provides liquidity for management, minority shareholders, and investors.

• Prestige: Added prestige and visibility with customers, suppliers, as well as the financial community.

• Increased Wealth.

• Estate Planning Tool.

• Raise Capital: It is usually easier to raise capital as a public company because then stock brokerage firms and their clients may be able to buy your stock.

• Leverage: Use public company stock to trade for advertising.

MSI has been in the business of bringing companies public for over 10 years and can guide a client through the maze of document creation and filings.

Reverse Mergers: The most popular way of going public over the last several years is through a Reverse Merger. The IPO method was severely curtailed after the “dot com” bust. A Reverse Merger is the acquisition of a public company by a private company, allowing the private company to bypass the usually lengthy, expensive and complex process of going public through an IPO. Typically, in a Reverse Merger, 90% to 95% of the public company is purchased from a controlling group. Not all shares are purchase, because there is a need to have a number of shareholders to maintain a market for trading shares. The public company being bought is often referred to a “Shell” corporation because it has little or no current operations. Once the Shell is bought by the private company, it moves its operations into the Shell and typically changes its name to reflect its business, or the name of the private company that wants to maintain its name.

Not all Shells are created equal and when buying a Shell you are buying all its liabilities, including future lawsuits and other skeletons, which you may not be aware of at the time of closing. That is why it is critical to have professionals perform Due Diligence on any Shell purchase, prior to closing. MSI works with accountants and attorneys to oversee this Due Diligence process.

Call us TODAY at (407) 389-5900 to discuss how MSI can assist your company in Going Public.