Why Is Going Public So Costly?

Markit Ltd. (ticker MRKT) sold 53.5 million shares on Thursday, June 19, at an offer price of $24 each, raising $1.28 billion. The company is a financial data provider with expertise in financial derivatives, including credit default swaps. Unusually, all of the shares came from existing shareholders, mainly investment banks that are also customers of Markit. At the close of trading, the stock was valued by the market at $27 per share, giving the offering a value of $1.45 billion. In return for ...