CNN news 2012-02-05 加文本

cnn news 2012-02-05

CARL AZUZ, HOST, cnn STUDENT NEWS: Hi, I`m Carl Azuz and this is cnn Student News traditional versus virtual. How would you prefer to go to school? That`s what we asked on our blog. Today we`re sharing what you had to say.

First up though, a deadly riot breaks out after a soccer match in Egypt. This happened yesterday. Once the match ended, fans from both sides rushed the field.

AZUZ (voice-over): You can see in this video the scene was just chaos. People hit each other with rocks and chairs. In the fighting, at least 73 people were killed. More than a thousand fans were injured. The Egyptian military sent two planes in to get the visiting team, some of its fans and some of the injured out.

A cnn contributor, who`s researched soccer in the Middle East, says you sometimes do get violence between soccer clubs, but he said he`s never seen anything this big before.

AZUZ: If you want to own a company, it`s not as difficult as you might think. One way you can do it is to buy some of the company`s stock. You won`t own the entire company, but you will own part of it. Before you can do that, though, the company has to go public and to make its stock available. And the first way it does that is through something called an IPO, an initial public offering.

AZUZ (voice-over): That`s what Facebook did yesterday. It went public and filed for an IPO. Experts predicted it would be the biggest IPO ever for an Internet company. Five billion dollars -- now that`s not what the company is worth. It`s how much money experts think Facebook is looking to make from its IPO.

AZUZ: So what does this mean for a company to go public? What are the potential pros and consumption of this? Christine Romans has some answers.

CHRISTINE ROMANS, HOST, "YOUR BOTTOM LINE": IPO stands for initial public offering.

An IPO is when a company, whether it`s a mom-and-pop little store that`s getting bigger and bigger, or say, a social network conceived in a Harvard dorm room that now has 500 million people who follow it, can get on the radar, get -- attract capital and basically grow up.

Companies want to go public because they want to unlock the value in their enterprise. When you can get investors to pay to buy shares of your company, and then those shares are trade on a stock market, like the NASDAQ or the New York Stock Exchange, it also gets you money.

When you go public, investors are putting money into your enterprise. It allows you to raise money quickly.

One of the down sides is when you are a public company, you are scrutinized by the government. You have to, every quarter, file your numbers, your balance sheet, to the Securities and Exchange Commission so that your investors and so that the markets can see exactly what you`re doing.

If you`re a private company, you don`t have that kind of scrutiny. You don`t have investors selling their stakes in your company if you have one or two bad quarters. So that`s one of the reasons why private companies like to stay private.

Well, eventually, it`s everyone, like you and me. Initially, at an initial public offering, it`s the big names who get in. It`s some of those original private investors, they usually get a good shot. Founders of the company get a good shot to buy more if they want.

Facebook is the Holy Grail of IPOs. It would be probably the biggest tech company IPO in history. Facebook already has 500 different private investors basically. And when you get to that level, that threshold, that`s when the Securities and Exchange Commission says, OK, now you`ve got to open your books. Now you`ve got to file and become a public company, you`re getting too big.