Which type of offering works best when a company needs to act quickly?

The overnight follow-on offering is particularly suited for situations where a company must act rapidly, primarily because it allows for a swift execution process. In this type of offering, a company can announce the deal and sell shares to institutional investors within a very short timeframe, often just overnight. This speed is due to less extensive marketing and roadshow efforts compared to other types of offerings, which may require lengthy preparation and investor engagement.

The structure of an overnight follow-on does not necessitate extensive pre-marketing or public disclosure, enabling the company to capitalize on favorable market conditions quickly. This immediacy is crucial for companies that need to secure funding urgently due to market opportunities, unforeseen challenges, or other strategic reasons.

In contrast, other options like marketed follow-on offerings involve extensive time spent on marketing and demand generation, potentially limiting their responsiveness to market conditions. Bought deals may introduce a degree of certainty regarding pricing and allocation but typically involve negotiation steps that can delay execution. Sponsor-backed IPOs are generally longer processes that include building investor interest over time before going public, which is not conducive to rapid action. Thus, when urgency is a key factor, the overnight follow-on offering stands out as the most efficient choice.