Changing of XYZ Company from Private to Public Ownership

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Any company planning to change ownership from private to the public should analyze the prevailing economic and legal factors (Gale, 2007). An understanding of the legal requirements and laws will enable the company to come up with right the decisions for the growth of its business. As XYZ Construction Company plans to change its ownership from being a private to a public company, it should note that its legal environment would also change. The company should note that economic factors such as capital and shares have to be studied to ensure a smooth transition of ownership. As such, managers should come up with detailed and informed decisions.

As the company plans to grow both domestically and internationally and change its ownership, there are several laws that should be considered. The regulations are the environmental laws, occupation laws, safety and health laws, qualification laws, public interest laws, diversity laws, antitrust laws, incorporation, bankruptcy, patents, copyrights, and consumer laws (Alavi & Pham, 2008). All these laws form the required legal framework for the operation of an organization. In the past, the United States government passed important laws to enhance business commerce. The antitrust law eliminates monopoly resulting from building up of trusts.

The law of public interest is important to the community. The law checks the actions of the business against the benefits they receive in return. The employees and the public should be aware of their rights. Such laws are enshrined in the protection of interests and rights. The law of public interest guards the XYZ construction workers’ welfare and they should complain in case of any violation. It is the responsibility of the lawyers and judges to determine the public welfare by weighing it against the benefits of the company.

If the company enjoys substantial benefits at the expense of the interest Of XYZ employees, the action should be considered illegal. As such, the action of XYZ can be stopped by court order in the event of a violation of workers’ rights. The other laws that affect the business’ occupations include quality, diversity, health, and safety laws. The laws that regulate the occupation in the XYZ Company should be followed strictly.

According to in the United States’ economic policies and laws, the employees are required to have certain skills, qualifications and experiences before being hired or promoted. Therefore, as the company plans to change its ownership its workers should be aware of the rules and procedures of hiring public workers.

Another important decree that the workers of the XYZ Company should explore before the change is implemented is the law of diversity. The law’s main objective is to enhance the employees’ rights of promotion, retention, and hiring. The law ensures that workers are not employed based on religion, gender, ethnicity, or age. As the management and owners of XYZ Inc are in the plan of changing the company’s ownership, they should fully respect the law of diversity.

In case of any necessary layoffs among its workers, due procedures should be carried out under the directions of the courts to ensure that fairness and justice are upheld (Draho, 2004). Equally, the company’s field offices should have a fair share of resources for the workers. In case of some layoffs, the company should ensure that its effect is distributed equally among the 16 offices. When there is evidence of unfairness in the retention of workers during the transition processes, the company’s workers should launch their grievances before the law courts. In practice, human resource tends to promote, hire, and retain workers from the same religion, age, and gender. They believe that workers with similar group identities cooperate with ease.

What is important is that workers of XYZ construction Inc should be suing the company in the event that injustice is observed in the employees’ welfare. Any company that violates this law by engaging in discriminatory employment acts stands being fined hefty charges in the law courts.

The law applies equally to both private and public companies since workers’ rights must be protected. As such, the company should compensate its workers in case of any damage during the transition process. Employees of the company should also understand their safety and health laws since the field workers are exposed to accidents. The company should compensate workers injured in the field during construction work. The unawareness by workers of the existence of employment and labor laws remains a challenge in an organization.

The legal framework is an important portion of the processing of the Initial Public Offering (IPO). Therefore, the managers and owners of XYZ construction Inc should follow diligently all the laws and procedures involved in the IPO. The laws protect the company and board of directors from any liability, which might arise in the operation of the company because they are responsible for the documentation of the admission of IPO (Farooq, 2012).

The procedures and laws address various issues concerning the share. For instance, the legal framework contains the method of determination of the value of a share and the total shares to be offered to the public. After the determination of the number and value of each share, the company should then offer each share to the public (Pull, 2002). Managers should ensure that there is no oversubscription of shares. In case of oversubscription, the company should devise mechanisms of allotting shares.

The mechanism should compensate the public money. When the target capital has been raised, the company should stop the IPO and inform the public of the direction. Shareholders are free to trade their shares once a stock exchange officer has approved it. The company also has to set the number of annual dividends to be issued to shareholders and the portion to be reserved.

In addition, the company should analyze several economic factors before coming up with appropriate decisions. Usually, economic factors affect the investment value and performance of any business. Therefore, economic factors are important in the determination of the current and future growth of the company. The key economic factors include interest rates, government policies, labor costs, tax rates, and management. XYZ has 16 field offices in 11 states and each of these offices has a staff. Its headquarters is situated in Denver in Colorado the company has project managers and administrative staff. Always, good management leads to the success of the company (Gahan & Coney, 2012).

Therefore, as the company plans to grow both locally and internationally, it should hire qualified and experienced managers. Efficient managers can be resourceful as the company transitions. Therefore, the company should retain project managers because they have adequate experience. The company currently has an average of 2300 workers per annum. The number increases to 4500 during the construction peak season. Thus, the company should find ways of cutting down the labor costs by adopting advanced technologies in construction ventures. As the company changes its ownership from a private to a public company, managers, workers, and the shareholders should consider the legal framework carefully.

References

Alavi, A., & Pham, T. M. (2008). Pre-IPO ownership structure and its impact on the IPO process. Journal of Banking & Finance, 32(11), 2361-2375.

Draho, J. (2004). The IPO decision: why and how companies go public. Cheltenham, UK: Edward Elgar Pub.

Farooq, O. (2012). Earnings management behavior of the initial public offering (IPO) firms during pre-IPO, IPO and post-IPO years: Evidence from the Casablanca Stock Exchange. African Journal of Business Management, 6(31), 11-56.

Gahan, P., & Coney, S. (2012). Economic Globalization and Convergence in Labor Market Regulation: An Empirical Assessment. American Journal of Comparative Law, 60(3), 703-742.

Gale, C. (2007). The business of business law. Managerial Law, 49(1/2), 10-12.

Pull, K. (2002). The comparative attractiveness of international business locations: the role of labor law. Management Decision, 40(7), 647-654.

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Changing of XYZ Company from Private to Public Ownership

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