The past couple of years have resulted in hard economic times for companies worldwide. Sales and profits have dropped at an increasing rate forcing companies to close their doors. Those who are fortunate enough to still be around have had to get creative with the how they run their businesses. One way that companies are increasing their values is by taking moving from a strictly private market to a public market. One such company is Transglobe REIT.
In April of 2010, Transglobe submitted the preliminary prospectus to open their company up to the public. This decision has many benefits both for the company and the shareholders.
To begin, going public raises additional capital for the company in a much easier and faster way than trade shares because the funds go directly to the company. This is not only an important part of keeping the business operating at the ideal level but also for making improvements and taking the company to the next level. It also substantially opens the field of investors, allowing more people to contribute.
The benefits of the change are not one sided. Although there are many benefits to the company, the investors benefit as well. As an individual investor, the value of your stock in the company goes up as the company continues to succeed. For the existing investors, even though their stock value decreases when the company first goes public, their stock will ultimately go up as the company grows and continues to do well.
The benefits of going public are shared all around. The company receives the capital it needs to remain operational and even get ahead, while individuals and investors benefit monetarily from their success. Although it is frequently only open to the company’s country of origin, which for Transglobe is Canada, the prices are so low, only $10 a share, that many people will be able to take part.
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