Evercore Equity Capital Markets (ECM) Interview Practice Test 2025 - Free ECM Practice Questions and Study Guide

A company may opt for an overnight follow-on offering primarily to raise capital quickly. This type of offering allows the company to expedite the process of securing funds from the market, often as a response to immediate financial needs or market conditions. By conducting an overnight offering, the company can leverage investors' readiness to participate in capital raises and shorten the timeline typically associated with traditional follow-on offerings.

This choice enables the issuer to capitalize on favorable market conditions or respond to urgent funding requirements without lengthy delays. The speed of execution is essential in scenarios where a company requires funds swiftly, such as for acquisitions, working capital, or to bolster its balance sheet. In contrast, options involving large-scale long-term capital needs or maintaining capital structures involve strategic, longer-term considerations that are not conducive to the rapid nature of an overnight follow-on offering. Additionally, while improving investor relations may be a beneficial outcome, the primary motivation for this type of offering centers on the urgency and efficiency of raising funds.