What is green shoe option with example?

What is green shoe option with example?

The greenshoe option provides initial stability and liquidity to a public offering. As an example, a company intends to sell one million shares of its stock in a public offering through an investment banking firm (or group of firms known as the syndicate), which the company has chosen to be the offering’s underwriters.

What is green shoe option Slideshare?


  • Green shoe option means an option of allocating shares in excess of the shares included in the public issue and operating a post listing price.
    • It is a provision, in underwriting agreement, that allows the underwriter to sell the additional shares then the original number of shares offered.

      What is meant by green shoe option *?

      What is a Greenshoe Option? A greenshoe option allows the group of investment banks that underwrite an initial public offering (IPO) to buy and offer for sale 15% more shares at the same offering price than the issuing company originally planned to sell.

      What is green shoe option in India?

      Green shoe option is a clause contained in the underwriting agreement of an IPO. It allows the underwriting syndicate to buy up to an additional 15% of the shares at the offering price if public demand for the shares exceeds expectations and the stock trades above its offering price.

      Who was the first to use green shoe option in India?

      ICICI Bank was the first company to use the GSO under the book building route. DSP Merrill Lynch was appointed as the Stabilising Agent to maintain the post-issue price and for this the GSO was up to 15% of the issue size.

      What is ASBA allotment?

      Application Supported by Blocked Amount (ASBA) is an application made by an investor, containing an authorization to Self-Certified Syndicate Bank (SCSB) to block funds available in applicant’s Savings Bank Account or Current Account (other than Overdraft or loan accounts), for subscribing to an Issue, to the extent of …

      What is non-ASBA?

      In ASBA , the amount is not debited from your Savings Account until successful allotment whereas in Non-ASBA process, the application money is debited from the Bank Account once the bid application is successfully placed with AxisDirect.

      Is CRN and BOID same?

      You will need to pay the MeroShare charge while filling up the form. Then the username (which is your BOID number) and password of MeroShare will be provided to you. For some banks, the CRN number is the same as their bank account bank linked with the DEMAT account.

      What is C ASBA?

      Application Supported by Blocked Amount (ASBA) is a process for applying to public/rights issues submitted by investors by blocking the application money in their bank account while subscribing to the issue. C-ASBA is also provided by Everest Bank Limited from all over its branches inside and outside Kathmandu.