Assignment 4 Example | Topics and Well Written Essays - 1750 words

4 - Assignment ExampleDeltek Systems Inc. decided to go public in 1997 by offering its shares in the market. totally organization has to ensure that it makes the final decision of going ahead with initial public offerings (IPO) after evaluating all vital factors properly. In case of Deltek, the confederacy decided to offer its shares to the general public for numerous reasons. The first of all factor that led the companys management to go public was to avail the opportunity of accumulating cash for the purpose of expansion. One of the expansion strategies is to allow the organization to go public so that shares can be bought by the shareholders and, accordingly, the heart and soul can be used for expansion. This trend was common during that time period as the software companies that were incurring losses were going public to utilize the chance of earning a good amount of revenue. According to the case, Deltek decided to go public because it allowed the probability of acquiring additional funds for financing its emersion along with enhanced visibility. When a company is listed in the standard market, its awareness is increased and it has an advantage of enhancing its prestigiousness among its valu up to(p) customers. Gaining awareness amongst mass consumers is another positive point of allowing the organization to be listed on the stock exchange. The central driving force that led to the decision of going public was that the employees of the company should be tending(p) the opportunity of reaping benefits for having the stock options. Since the company was a private venture, there was no market for selling the companys stocks. Considering the scenario of the company, it wanted to offer its employees a platform to utilize the avenue of earning additional income. Since the technological firms were able to make further revenue from the stock market as a result of inflationary prices, it was a logical decision to exploit this proposal for improving the com panys performance and financial viability of the employees. tender resources are an important asset for the organization and their financial stability in the firm should be peerless of the utmost concerns for the management to ensure productive services by the employees. Question 2 What advantages did Deltek find in going public once it became a public company? What disadvantages did it face? Answer 2 When Deltek Systems Inc. became a public company in 1997, it was proficient in earning an excessive amount of profit because its stock prices were outgrowth at an accelerating pace. The biggest advantage to the company for going public was the ability of making use of its strong set up in the technology market along with the stock market. It had a robust performance initially but, corresponding all other companies, it had to face various turbulences as the stock market has the feature of intense fluctuations passim the year. In late February 1997, the company sold about 2.9 milli on shares on the stock market for $11 each. During the following summer, the sales of the company grew at an exponential rate that was evident from its reported strong loot in the stock market. By August, the earnings doubled, and this trend continued until the next year. However, afterwards, the company saw long variations in the stock price of its shares as it oscillated in between $15 per share to $24.50 per share. This fluctuating manner of the