What is the role of a managing underwriter in an IPO?

The role of a managing underwriter in an initial public offering (IPO) primarily involves coordinating the entire process of the offering and managing relationships with all parties involved, including the issuing company, investors, and other underwriters. This includes preparing the issuance documentation, facilitating communication, and ensuring that the marketing efforts target potential investors effectively.

Managing underwriters play a crucial part in guiding the company through the complexities of going public. They are responsible for ensuring that all the necessary steps are taken in a timely manner, from regulatory compliance to roadshows that generate interest among investors. Their expertise and connections in the investment community help to align the interests of the issuing company with those of potential investors, ultimately leading to a successful IPO.

Determining market demand for the stock and setting the price for the shares are responsibilities that the managing underwriter may assist with, particularly through their research and investor outreach. However, these tasks are part of a broader coordination role rather than standalone responsibilities. Performing audits is more aligned with the functions of accounting firms or internal teams within the issuing company and is not part of the underwriter's duties.