Issuing Corporate Securities - Awarding The Issue

There are two ways in which the corporation may select an underwriter. A corporation may elect to have multiple underwriters submit bids and choose the underwriter with the best bid. This is known as a competitive bid underwriting. A company may elect to select one firm to sell the issue and negotiate the terms of the offering with them. This is known as a negotiated underwriting. Most corporate offerings are awarded on a negotiated basis, while municipal bonds offering are usually awarded through competitive bidding.



The Underwriting Syndicate


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RELATED TERMS
  1. Competitive Bid

    A step in the initial public offering process whereby an underwriter ...
  2. Underwriting Fees

    Underwriting fees are monies collected by underwriters for performing ...
  3. Negotiated Underwriting

    A process in which both the purchase price and the offering price ...
  4. Underwriter

    An underwriter is a company or other entity that administers ...
  5. Underwriting Agreement

    A contract between a group of investment bankers who form an ...
  6. Stabilizing Bid

    A practice used by underwriters to stabilize the secondary market ...
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