What Is an Equity Offering?

Stock issuance is the process of selling a company's new stock. Once a new stock is issued, it enters the applicant's hands through an intermediary or a self-employed person, and the applicant subscribes and holds the stock to become a shareholder. This process generally does not have a fixed and centralized place, or issuance by the company itself. More commonly, it is underwritten by investment banks, trust companies, securities companies, and brokers. There are two cases of issuing shares: the establishment of a new company, the first issue of shares; the established company increases its capital to issue new shares. Both are different in release steps and methods. To create a new company for the first time, a series of procedures are required. That is, the company s articles of association are drafted by the promoters, reviewed by lawyers and accountants, and published in newspapers. At the same time, they are submitted to the competent authority for registration after passing the examination, and they receive a registration certificate. issued. ^[1]

Stock issuance

In addition, in order to give the public a great potential and a prosperous impression as soon as the stock is listed, listed companies are choosing

Conditions of issuance

(1) The company's production and operation are in line with national industrial policies, and it has a sound and well-run organization;

(2) There is only one type of common stock issued by the company, with the same rights and rights;

(3) The amount issued to the public is not less than 25% of the total share capital to be issued by the company, of which the amount of the share capital subscribed by the company's employees must not exceed 10% of the total share capital to be issued to the public; the company If the total amount of equity to be issued exceeds RMB 400 million, the CSRC may reduce the proportion of the part to be issued to the public as appropriate according to regulations, but the minimum amount shall not be less than 10% of the total amount of equity to be issued by the company;

(4) It has continuous profitability and good financial status;

(5) The issuer has no false records in its financial accounting documents in the last three years, and has not committed any other major illegal acts;

(6) Other conditions prescribed by the State Council's securities regulatory authority approved by the State Council.