Hi! I work in corporate finance here in Sweden and recently my firm has come in contact with several international companies who want to enter the Swedish MTF venues. We have been pretty successful in setting up alternative venues for smaller companies so that they can raise capital and extend their shareholder base under lighter regulations than the general stock market, which is why Sweden has caught the attention of the foreign community. However, in opening meetings with these firms who seek to be listed, they seem surprised when we begin discussing underwriters.
Underwriting share issues
In Sweden, it's very common for share issues to be guaranteed by underwriters. The underwriters commit to covering a portion of the issued amount should it not be covered by the market. The underwriters take an 8-12% fee on whatever capital they promise to commit, to be paid by the issuing firm in shares or cash. This is an insurance that the issuing firm will receive some or all the capital the seek regardless of market sentiment.
Is it common to underwrite share issues in other countries as described above?
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