EBay Case Study
Section A: Problem/Issue Statement
Following a 220% increase in profits and 800% increase in revenues over six months, eBay Inc. is considering the following courses of action:
1.One being an IPO offering, requiring the sale of less than 9% of the company. This offering will be for 3.5 million shares, with an expected sale price at between $14 and $18 per share.
2.The other is to delay the offering for six months. This will cost eBay approximately $1 million in direct …
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…stay on the conservative side in order to maintain the price.
4.Employees will want a high price because they will benefit from a growing company.
5.In this case, investment bankers will prefer that the price best reflects the market because they have agreed to a firm commitment underwriting. This will guarantee them the sale of all shares.
6.The competition will generally want a low price to keep eBay from raising capital to gain market share.
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