Public Offer

Public offer of a particular company is an invitation to the general public to partake in the stock holding status of the company by buying stocks offered by the company.

The primary market is the platform for such offers. Since it is a market for new issues like

  • IPOs,

  • Bonds,

  • Right issues, etc.

The forms for such offers can be obtained from public places like banks, post offices, government offices etc. It is one of the easiest way to investment business. Since the companies need money to do business.

The advantage of this method is that you do not have to pay commission to brokers and since the offer is through many public outlets like banks, financial houses, stock broking firms, issuing houses, post offices and other outlets deemed fit by the issuing firm. It is accessible to all levels of investors.

Types of public offer

  • Public Offer Privatization (POP)

    This occurs when a government company is being sold out to the public or when government is relinquishing it's holdings or stocks in a company or parastatal to the public.

  • Initial Public Offer (IPO)

    This is a situation when a company is offering its stocks to the public for the first time and getting itself listed as a quoted company on the stock exchange.

  • Normal Public Offer (NPO)

    This a type of offer made to the general public by companies seeking extra funds for expansion or development.

    NPO creates avenues whereby the public can have access to buy stocks without going to the floor of the stock exchange.

    In this kind of offer you have a right to subscribe for as much as possible but you will only be allotted based on the discretion of the issuers and in such a way that it goes around to virtually all the subscribers. Allotment will be made based on compliances with the rules stipulated in the prospectus given out to every subscriber by the issuing house.

    There are some Public offer factors that you have to consider before investing in an any offer (PO, IPO and POP)
