EBay Case Study

Section A: Problem/Issue Statement Following a 220% increase in profits and 800% increase in revenues over six months, eBay Inc. is considering the following courses of action: 1.One being an IPO offering, requiring the sale of less than 9% of the company. This offering will be for 3.5 million shares, with an expected sale price at between $14 and $18 per share. 2.The other is to delay the offering for six months. This will cost eBay approximately $1 million in direct …

…stay on the conservative side in order to maintain the price. 4.Employees will want a high price because they will benefit from a growing company. 5.In this case, investment bankers will prefer that the price best reflects the market because they have agreed to a firm commitment underwriting. This will guarantee them the sale of all shares. 6.The competition will generally want a low price to keep eBay from raising capital to gain market share.