Secondary Offering

What this video covers

• Why a secondary offering means existing shareholders sell already issued and outstanding shares, not the company
• Who receives proceeds in a secondary offering versus a follow-on (additional primary) offering, and why following the money reveals the correct answer
• Why "secondary offering" does NOT mean a company's second offering chronologically, and how the exam exploits this common misconception
• What dilution actually means: new shares reduce an existing shareholder's ownership percentage, and why secondary offerings are non-dilutive
• How follow-on offerings create new shares, raise capital for the issuer, and dilute existing shareholders like Ivy's pizza slice
• What combined offerings are: simultaneous primary and secondary components, and how the prospectus discloses who receives which proceeds
• How to dissect paragraph-long exam questions by identifying whose pocket the cash enters