New private property

Author: | Published: 1 Jul 2007

Dan Andrews
Features editor

Private offerings outstripped initial public offerings in the US for the first time last year. According to a report in the Financial Times, companies in the US raised $154 billion on the country's three biggest exchanges, compared with $162 billion raised through Rule 144A placements. In 2005, public offerings on Nasdaq, the American Stock Exchange and the New York Stock Exchange raised $147 billion; deals with private placements raised $101 billion.

Goldman Sachs has established its own private system for companies to sell equity to institutional buyers. Goldman Sachs Tradable Unregistered Equity (GS True – or TrUE, if you prefer a migraine) is the first of several new, private exchanges being considered by US investment banks and brokers. These over-the-counter markets for unregistered equity securities will be closed to retail investors with securities marketed, exclusively, to qualified institutional investors with at least $100 million to spend.

Simpson Thacher...