New platform links IPO issuers direct to investors
US investment bank Rodman
& Renshaw is launching an electronic transaction platform that bypasses brokers, connecting issuers straight to investors seeking access to initial public offerings.
Rodman's DirectMarkets will let issuers sell shares directly into the secondary market, where investors can contact issuers and indicate
their interest. The new platform is due to make
its debut in early March 2012.
DirectMarkets will be led by former Liquidnet chief information officer and founding
member Kevin Lupowitz. The new platform will let investors accumulate stock positions more cost-effectively than through
ongoing open market purchases and bring greater efficiency to the methods public companies use to raise capital, including
follow-on offerings, registered directs, at-the-markets, confidentially-marketed public offerings and private investments in public equities.
The platform provides execution and order management system
integration for primary offerings, as well as workflow management tools for
complex transactions beyond the standardised offerings of common stock at an
agreed price. Another proposed benefits of the new platform is the automation of the closing process for capital markets
“DirectMarkets will be a game-changer and with Kevin
Lupowitz’s talent and experience at the helm, this new electronic transaction
platform is the catalyst that will redefine Rodman as an innovative technology
company focusing on the financial services industry, while strengthening our
legacy business,” said Edward Rubin, CEO of Rodman & Redshaw.
In conjunction with the launch of DirectMarkets, Rodman intends to
change its name to Direct Markets Holdings, subject to stockholder approval at
its annual meeting on 4 May. The firm’s sales and trading and investment
banking operations will continue to be conducted under the Rodman & Renshaw