A private placement is like a limited marketplace where you offer your shares for sale. This limited marketplace could include banks, insurance companies or superannuation funds and is usually done to raise capital. In the United States, a private placement means the company placing it does not need to register it with the Securities and Exchange Commission or disclose detailed financial information.
For example…
US-based firm Neuro Research Group pr NRG engaged CB Capital Partners to create a private placement. NRG, a next-generation medical device company was able to focus on its core operations of product development and clinical trials while CB Capital’s investment bankers executed the private placement. To do so, CB prepared confidential private placement memorandum and got in touch with interested investors, sought letters of intent, conducted due diligence, evaluated proposals and secured ten million dollars’ worth of aggregated funding for NRG at a favourable per share valuation.
