“It would be a game-changer in the world of asset management if company equity could be bought and sold on the secondary market.”
Ben Popper has an interesting scoop on BetaBeat that you probably haven’t heard much about…
Most people associate SecondMarket with privately-traded shares of Facebook and Twitter – but what if I told you that shares of Pimco (home of the world’s largest mutual fund) were quietly changing hands there?
So says Popper:
In fact, Betabeat has learned, one of the most significant players in the financial world has already begun testing the waters. Stake in PIMCO, the closely watched asset manager with over $1.2 trillion under its control, has been quietly selling on SecondMarket, according to a source familiar with the deals.
Speculation has swirled in recent months about a growing rift between PIMCO and its parent company Allianz. News that PIMCO was trying to launch its own brokerage biz right here in New York led to rumors of a further split or even a public offering.
I’ve been critical of the existence of these multi-billion dollar “private exchanges” in that they offer an elite group access to a, shall we say, less regulated capital formation resource. My argument is not a class warfare one, rather an issue of fairness. Why should some companies have the ability to offer non-IPO exits and liquidity while the rest must go through the more rigorous traditional process to raise capital?
With giants like Pimco now listing on these exchanges, the danger is a subversion of existing securities rules and a lopsided form of capitalism in which some companies are favored over others when looking to cultivate shareholder bases.
I highly recommend you click over to read the whole piece.