Any company exploring whether to go public would get greater leeway to discuss their plans privately with potential investors before announcing an initial public offering, under a proposal that securities regulators released yesterday, the Wall Street Journal reported. In a bid to boost the number of public companies, the Securities and Exchange Commission proposed letting all companies “test the waters” before deciding whether to seek an IPO. The agency had previously allowed only smaller, emerging companies to talk to investors privately. Currently, large companies must publicly file their securities offering documents to regulators before gauging investor interest. The 2012 JOBS Act allowed small companies to talk to investors before beginning that process, a provision that would be expanded to all companies — including investment firms — if Tuesday’s proposal is completed. Making it easier and more appealing for companies to go public has been a central goal of SEC Chairman Jay Clayton. The number of public companies has fallen by nearly 50 percent since the late 1990s. Several startups valued at above $1 billion, including Uber Technologies Inc. and Airbnb Inc., have held off on going public, though there are signs that some of those companies might make the move in 2019.
