Is it good when a company goes private?
Okay, so, is it a good thing when a company decides to go private? Well, that's a loaded question, isn't it? It's not always a clear-cut win or lose, you know?
From the perspective of someone who already owns shares, like maybe you or me if we'd invested? Actually, I remember when Dell went private back in 2013. I had a few shares, not a ton, but I did. Anyway, going private can be pretty sweet because usually, the people buying the company – the investors – offer a price that's higher than what the stock is currently trading at. It's like, "Hey, we really want your shares, so we'll pay you a little extra!" I got a little bump when Dell went private, which was nice.
So you get a bigger payout than you would have if you just sold on the open market. Ka-ching! Right?
But, and this is a big but... all those potential future gains? Gone. Poof! All the growth the company might have experienced, all the dividends they might have paid out down the line... you don't get any of that. It all goes to the new owners. And, of course, you no longer have publicly traded shares. You can't just hop on your brokerage account and buy or sell them anymore. The company isn't public, so, naturally, it isn't traded publicly.
It's a trade-off, really. Immediate gain versus potential future gain. It really just depends what your personal strategy and timeline for investing is.
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