Going Private

Very different than going in private. Make sure you slide over the little "Occupied" latch before dropping trou.

Ok, so...what is "going private"? Well, hold a mirror up to "IPO." Yep, initial public offering. You’ll see it…in reverse.

That’s kinda what going private is. The IPO took your company public. Investors bought and sold the stock. They were in love with it. And then...they weren’t.

You are sick and tired of dealing with public investors’ moodiness, and you just want your old company back. So the process of going private usually involves management. The people who run the company (or new management) brought in for this purpose, who have taken on large amounts of debt, and have offered some premium price above where the stock is trading to then…own it and delist it off the exchanges its trading on.

Like...the Leany Potty. A great new product for people who don’t like to…squat. It’s trading at $15 a share after coming public at $12, and at one point kissing $100 a share. The founder, Lionel Leany, wants to take it private and will offer $18 a share for the privilege.

If investors tender their shares (or sell them back to the company or buyer buying them), then the company no longer has a ticker symbol, stock options, the prestige…all of which are the fruits of being public. It’s just owned by whoever bought it. And they can do more or less whatever they want with it at this point.

They don't have to file public quarterly reports. They don’t have to conform to federal disclosure laws for public shareholders. They can pretty much ignore the myriad costs of being public, and just run the business to grow and produce cash for shareholders.

Yeah, ahh…the benefits of going in...er…being private.