The London Stock Exchange uses cookies to improve its website. The cookies for analytical purposes have already been set. For more details and how to manage cookies, please see our privacy and cookies policy.

Issuers


Issuers

 

An issuer is an organisation that registers, distributes, and sells a security on a Primary Market. An issuer can be a private company or a government or even an Exchange for derivatives such as equity and index futures and/or options. There are different kinds of financial instruments which can be issued: shares, bonds and derivatives, GDRs (global depository receipts).

For shares, the primary market refers to the initial issuance and, therefore, to a company’s IPO price. The products traded – securities – are "delivered" by issuers, that is to say, listed companies, who are obtaining equity financing through a new share issuance.

Exchanges may themselves be listed companies, as for example the London Stock Exchange Group, NYSE Euronext, Deutsche Boerse, Nasdaq OMX …

By listing on an exchange through an Initial Public Offering (IPO), a company that has previously been in private hands goes public.

The issuing price is an indication of the initial price determined at the Exchange following a specific process.

The evaluation of a company is made by the wider market. Advisers who follow the company and take it to the market act as intermediaries between entrepreneurs’ or CEOs’ pricing expectations and an investors’spending capacity.

In order to do this, advisers use evaluation methods which compare the listing company to all its listed competitors and ask all potential investors to provide  their pricing estimate when they express their demand (bookbuilding phase). The final pricing confirmation however, occurs on the first trading day, when the market opens and orders effectively are input into the trading system.

bookbuilding
 

(*) Bookbuilding = The process by which an underwriter attempts to determine at what price to offer an IPO based on demand from institutional investors.

However, once the company is listed, the price set by trading after an IPO can sometimes differ from the IPO price depending on:

  • The accuracy with which the IPO price was set up
  • The varying pressures of supply and demand in the secondary market
    – Issuers of bonds (including Governments)
    – Issuers of securitised derivatives

 

trasparente

The Exchange accepts no responsibility for the content of the website you are now accessing or for any reliance placed by you or any person on the information contained on it.

By allowing this link the Exchange does not intend in any country, directly or indirectly, to solicit business or offer any securities to any person.

You will be redirected in five seconds.

You are accessing the London Stock Exchange Annual Report Service powered by PrecisionIR.

The Exchange accepts no responsibility for the content of the reports you are now accessing or for any reliance placed by you or any person on the information contained therein.

By allowing this link the Exchange does not intend in any country, directly or indirectly, to solicit business or offer any securities to any person.

You will be redirected in five seconds