What does it mean for a company to go private? Is it the same as liquidation? Is it a good thing for the company?

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I’m writing a story about a company with a new leader focused on making stock prices rise. I want to get the company to do basically the opposite of making their company public. From what I’ve read, you don’t want to do buybacks as a company and going private might be equally as bad, but is it?

In: Economics

13 Answers

Anonymous 0 Comments

“Liquidation” happens most often when a company goes out of business for some reason (usually through bankruptcy) and it sells off all its assets (usually to pay creditors using the cash from the sale). Very often, other companies will buy the assets. That’s why you sometimes see that X company bought Y company out of bankruptcy if you follow business news at all.

Taking a company private usually means a group of investors made an offer to buy all the stock in a given company, and then agreed to delist them from stock markets so they can’t be publicly traded.

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