SlyOldDog - 3:36 pm on Jun 15, 2003 (gmt 0)

>>If the copmpany gets close to FMV for the shares - they wouldn't in many cases have to make a second offering - which would lower the value of the initial shares. I can't see this being in the companies interest.

Isn't the idea to get over fair market value?

Sell 10% today at 50% discount. Lose 5% of the market value of the company. Shares surge almost straight away. Gain great goodwill.

Sell another 80% in 2 years at a 30% premium. Earn 24% on top of the company's true market value. Shares drift downwards. Hey - you can always blame the market ;)

The owners retain 10% to show their "interest" in the company, but are already on their way to the Bahamas.