Nasdaq Private Market reports increased activity in private company liquidity programs. Companies that are choosing to stay private longer are using structured and controlled liquidity as a recruitment and retention tool, according to the Nasdaq report. In the first half of 2017, the Nasdaq Private Market Platform had 19 liquidity programs, with a total program volume of $733 million and 1,765 program participants.
62% of the programs were share buybacks and the remaining 38% of the programs were structured as third-party tender offers. These programs had an average size of $40 million. The report notes that most of the 19 programs were employee-focused, where 84% of eligible sellers were current and former employees.
Nasdaq also notes that there are now a wider range of companies that are interested in private liquidity programs—a shift from the predominantly later-stage companies accessing these programs in the past. Companies conducting liquidity programs for the first half of 2017 on the Nasdaq platform had a median valuation of $1.4 billion and median age of 8.5 years.
To read Nasdaq's report, visit: https://www.nasdaqprivatemarket.com/sites/default/files/1H%202017%20Private%20Company%20Report.pdf
Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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