What is the effect of a public company going private?

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Doesn’t the inability to trade the shares on a stock exchange alone diminish their value?

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Anonymous 0 Comments

It means they don’t have to answer to shareholders or worry about quarterly results to make investors happy. It means all profits go to the owner as they please. They don’t care about value today/tomorrow, but focus on long term… maybe they have a plan that they think will grow the business and they can eventually go public again for a higher value (this is a lot of what private equity firms do, take companies private and turn them around to spin out public again).

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