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What’s necessary to take a private company public? Ask the Lawyer

March 24, 2026

Q: We are giving serious thought to taking our privately held company public. Can you tell us some of the steps needed and what we have to do?

B.R., Hawthorne

A: While this column summarize some of the basics, clearly this is a decision that is best made after consultation with a qualified professional, and, if you go forward, to have on board someone(s) who can provide guidance and assistance. Talking with one or more others who have gone through the process is suggested as well.

There are a number of federal securities laws that come into play when a private company seeks to “go public.” These include the Securities Acts of 1933 and 1934, the Sarbane-Oakley Act, and the Dodd-Frank Act.

It probably will not surprise you to read that the primary regulator is the U.S. Securities and Exchange Commission. The two key stock exchanges – the New York Stock Exchange and the Nasdaq Stock Market – impose their own listing criteria.

There are typical financial thresholds. You also will want to consider what corporate structure is advisable (such as, perhaps a C-corporation). Further, governance of your entity must be established, such as an audit committee and audited financials.

Research indicates that if you are going to try for an initial public offering (an IPO), you likely will have a securities attorney, a reliable accountant, one or more investment bank underwriters, and professionals versed in investor relations.

Due diligence will be carried out. Your company will file a Form S-1 with the SEC (in other words, an SEC registration statement). Eventually, a share price is set, along with the number of shares to be sold, and a ticker symbol is set.

There are options to going public, such as a “direct listing,” or an SPAC merger (special purpose acquisition company), but those are beyond the focus of your inquiries.

Q: What is required to sell stock in our company to the public?

W.F., Long Beach

A: This question is responded to, in part, by the information above.

Bottom line, in order to sell stock to the public, your company has to complete a process overseen by the SEC. Research provides that before stock can be sold, you have to formalize your entity. This signifies having a Board of Directors, whose members are independent.

In addition, corporate governance policies must be in place and audited financial statements are to be prepared, covering typically two to three years. Internal controls must be established. There are then financial disclosures, the registration noted above and complying with exchange listing criteria.

After all that, some will nonetheless tell you the “real work” commences after the company is public.

Ron Sokol has been a practicing attorney for more than 40 years, and has also served many times as a judge pro tem, mediator, and arbitrator. It is important to keep in mind that this column presents a summary of the law, and is not to be treated or considered legal advice, let alone a substitute for actual consultation with a qualified professional.

What’s necessary to take a private company public? Ask the Lawyer Orange County Register

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What’s necessary to take a private company public? Ask the Lawyer

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