Ecclestone Corporation plans to go for an initial public offering and, therefore, seeks the help of an investment bank in issuing the new securities. The bank agrees to help the company in finding potential buyers and providing advice on the pricing of the securities. However, the bank does not guarantee that it will accomplish the task of selling all of the company's securities at a high price. In this scenario, the investment bank is using a _____ approach.

Question

Quizplus · Accepted Answer

The "best efforts" approach means the investment bank will try to sell as many securities as possible at the best possible price but does not guarantee the sale of all securities.

Ecclestone Corporation Plans to Go for an Initial Public Offering