Initial Public

Offerings

&

Investment Banking

How Does a Company Raise

Capital?

Private Placement vs.

Public Offerings

Going Public

Disadvantages;

• Costs of filing numerous reports

• Insider dealing becomes more difficult

• Managing investor relations is time consuming

• Market-determined price may not reflect true value

Advantages;

• Financial resources

• Liquidity

• Widespread publicity at home and abroad

• Institutionalization

• Secondary public offering opportunity

Financial Institutions

144 financial inst. are operating

Main business: Intermediation, portfolio &

asset management

Paid by commissioning from each activity they

do

In IPO process

2

47

05

Best-effort

underwriting

Stand-by

underwriting

Full underwriting Mixed

Methods used in IPO between 2002 and 2009

34

13

Stand-by underwriting Partially stand-by underwriting

Turkey’s IPO Background

• Banking crisis 2001

• Terrorism

• Iraq War 2003

• Political instability

• Financial crisis 2007

54 firms went public between

2002/2009

IPO Future

How about FUTURE?

New campaign (IMKB, TOBB, TSPAKB),

purpose is to reach 1000 companies by 2023

(Huseyin Erkan stated)

Until the end of 2010, 27 new companies (Koza,

Pegasus ..)

Foreign Investors

Finally;

I would like to clarify IPO with an

example from Turkish Market.

• Consortium with 39

financial inst.

24.98 % of its shares

has been sold

(312,250,256 stocks)

Best-effort underwriting

method

Book building through

collection of beats (6.4 –

8 TL)

Results; 2.476.100.502,

64 TL revenue

• Consortium with 36 fin. inst. leading by Is Inv.

• 25.18 % of its shares has been sold (322,000,000 stocks)

• Partially stand-by underwriting

• Book building through collection of beats (4.75 – 5.93)

• Results; 1.723.298.83 TL revenue.