The SpaceX IPO Just Handed Wall Street's Big Banks a Huge Payday. Here's What It Means for Their Stocks.
Several high-profile IPOs are boosting investment banking stocks.
Overview
SpaceX stock has finally gone public with the biggest initial public offering (IPO) ever, with a $75 billion share sale. The underwriting investment banks have made a fortune off the deal, even though their percentage payment was lower than usual.
The typical IPO pays 4% to 7% of gross IPO proceeds to the underwriters, going lower as the IPO size increases. According to PwC, IPOs worth $1 billion and up pay 4%, but SpaceX raised $75 billion, and according to reports, it paid 0.75% as an underwriting fee, worth $560 million.
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Details
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Originally published at www.fool.com.
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