Hmm. To me that just shifts the questions to the bankers.
If people (who don't know anything the bankers don't know) value the stock at $24, shouldn't there also be competing bankers willing to offer $20 a share for the whole lot, igniting a bidding war that converges roughly near the real price?
Obviously bankers need to make some money. But I don't see how this kind of deal has anywhere near a $1.4 billion dollar overhead, and I'm just boggled by the scale of the disparity.
> If people (who don't know anything the bankers don't know) value the stock at $24, shouldn't there also be competing bankers willing to offer $20 a share for the whole lot, igniting a bidding war that converges roughly near the real price?
Yes, though with a discount factor applied due to the risk involved. And particularly for a high-profile IPO like $SNAP, and one in which a lot of the sellers on Day 1 will be casual retail investors placing market orders[0], it's hard to gauge exactly how much hype there will be.
If people (who don't know anything the bankers don't know) value the stock at $24, shouldn't there also be competing bankers willing to offer $20 a share for the whole lot, igniting a bidding war that converges roughly near the real price?
Obviously bankers need to make some money. But I don't see how this kind of deal has anywhere near a $1.4 billion dollar overhead, and I'm just boggled by the scale of the disparity.