(WWJ) Quicken Loans Inc. may be going public.
A report published by business news outlet CNBC on Thursday said the Detroit-based mortgage lender, the largest in the U.S., is making plans for an Initial Public Offering (IPO), according to people close to the company.
"You'll be able to buy stock in the company, according to what the reports are telling us right now," said WWJ Business Editor Murray Feldman, on Thursday. "They plan an Initial Public Offering, which means they're going to find investors to take them to the marketplace, and on Wall Street you'll be able to buy shares of Quicken Loans."
Why take the company public?
"A company goes public to raise capital, to raise money, and that helps them expand their reach," Feldman explained. "It helps them become a bigger company and enables them to grow their value more than just from the profits from the business. If they attract a lot of shareholders, the price of their stock goes up, the value of the company goes up, everybody makes a lot of money."
Feldman said the downside to going public is there are no secrets anymore. "Everybody knows how much money you make, who gets paid what, how much profit margin you make, what your sales are, what your concerns are for the future. You have to tell shareholders everything, under the law."
Feldman said a lot of business people who have been in the private sector find the transition difficult to make.
Asked by WWJ about the report, a spokeperson for Quicken's Rocket Mortgage said: "As the nation's largest mortgage lender, Rocket Mortgage is continuously looking for new ways to invest in and grow our business, while also contributing in significant ways to our home communities. Given our continued growth, market leadership and strong financial performance, we are frequent targets of rumor and speculation. If, and when, there is news to report, it will come directly from us."
The company founded by billionaire Dan Gilbert has around 17,000 employees.
