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Comparison of Panama IPO Market to Us Market
enterprise in the public offering
· Helping to integrate the working team
· Procuring the realization of the due diligence
· Assisting in the technical preparation of the registration petition and the prospectus
· Holding the subscription contract with the enterprise
· Maintaining a relation with the issuer after the public offer
6. IPO’s Made in Panama
Among the IPO’s made in Panama we have the following:
· IDS Holding Corporation (Sears)
· Tropical Rainforest Resort (Gamboa Hotel)
· Corporación Microfinanciera Nacional
· Equus Entertainment de Panamá (Presidente Remón Racetrack)
· Inversiones Latinoamericanas (Inverlat)
7. Reasons for a company to choose to go public
Some of the reasons for a company to go public are the following:
a. Obtaining funds from the public offering of securities. With the funds obtained in this manner a company can increase its working capital, invest in research and development, expand premises and equipment, acquire other companies, etc.
b. Obtaining funds in more favorable terms. Once a market is created, and if the security (share) performs well, the company will be able to offer investors a security with liquidity and with a determinable market value.
c. The company can contemplate the acquisition of other enterprise with its public shares, instead of using cash or acquiring debts with third parties.
d. The enterprise may attract and retain better personnel by means of option plans for the purchase of its own shares by its employees. This is a great incentive to its labor force, thus generating more loyalty to the enterprises. In principle, there will be less labor problems since employees would largely feel part of the enterprise and wish the best for it, since this would also be the best for them.
e. The enterprise gains prestige and more recognition. Clients and suppliers may become shareholders and acquire the goods and services that their company produces.
f. Liquidity is obtained for the owners. Property in a close, non public business is an asset that lacks an immediate market. Once the company goes public, a market is or must be ready at any moment.
g. The company can eliminate existing guarantees, such as personal and/or real guarantees, so avoiding the need of personal sureties by the shareholders.
h. A sensation of financial success, at least of a psychological nature, is reached.
i. Undoubtedly, in our environment the tax advantages constitute a decisive factor. The existence of a special tax treatment for investments in registered securities is justified in the fact that, in this manner, individual resources can reach the productive enterprises that need them. This brings benefits for [next page]