Firms Favor Employee Share Sales Over IPOs, Morgan Stanley Says

Private companies with employee stockholders are more likely to do tender offers next than IPOs as pressure mounts to let staff cash out some of their holdings, according to research from Morgan Stanley.

Nearly 40% of the 150 venture capital-backed private companies surveyed by the bank’s stock plan administration unit expect their next liquidity event would be letting executives and employees sell to private investors. Only 31% see an initial public offering as the next opportunity for staff to sell.