The US Securities and Exchange Commission (SEC) has announced that the Division of Corporation Finance (Corp Fin) will permit all companies to submit draft registration statements relating to initial public offerings (IPOs) for review on a non-public basis. This process will be available for IPOs as well as most offerings made in the first year after a company has entered the public reporting system. The effective date is 10 July 2017.
This new process is similar to that used by emerging growth companies (EGC) under the Jumpstart Our Business Startups Act of 2012 (JOBS Act). Corp Fin believe that it will provide companies with greater flexibility in planning their offerings.
Further, the non-public review process after the IPO reduces potentially lengthy exposure to market fluctuations. By requiring a public filing period prior to marketing, the process incorporates a feature of the EGC review process that provides an opportunity for evaluation by the public.
The Corp Fin announcement discussing this matter is available from the SEC on this link.
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