Finance

How IPOs give the ‘illusion of diversity’ with underwriters, while paying minority-owned firms less

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A view of the New York Stock Exchange (NYSE) is seen at Wall Street on June 29, 2020 in New York City.

Angela Weiss | AFP | Getty Images

Warner Music Group Corp., the label for artists like Ed Sheeran and Cardi B, went public last month with 28 underwriters. More than a third of those firms were so-called MWVBEs, a special designation that stands for minority/women/veteran-owned business enterprises.

The $2 billion initial public offering paid out $79 million in fees, more than half of which went to the bulge-bracket banks that served as the lead underwriters for the deal. Middle-market firms took home between $694,309 and $1.4 million (with the exception of Raine Securities, which made…



Source cnbc.com

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