Reference no: EM132468681

A company needs to an additional $23 million dollars. This sum is too large for a bank line of credit and no one in the family has additional funding to invest into the company.

One alternative is to publicly issue debt (corporate bonds), the other alternative is to issue common stock to the public. Using your expertise in financial management, conduct an analysis of the current situation and provide a summary of your recommendations.

In your summary you must:

Question 1: Provide a narrative about the impact of issuing stock to the public. The narrative will include the topics of loss of control of the company and the requirements that future financial statements will be available to the public.

Question 2: Provide a narrative about the impact of issuing debt to the public. The narrative will include the topics of a potential loss of the company if debt covenants are breached and the requirements that future financial statements will be available to the public.

Question 3: Provide a narrative on the initial public offering (IPO) process using at least four research sources in addition to the textbook material. The narrative of the IPO process steps should include the:

1. role of an investment banker
2. deal negotiation
3. preparation and submission to the SEC of the registration statement
4. SEC approval
5. setting an issue date
6. setting an issue price