Page "Initial public offering" Paragraph 33

A Dutch Auction allows shares of an initial public offering to be allocated in an impartial way, with all successful bidders paying the same price per share.

One version of the Dutch auction is OpenIPO, which is based on an auction system designed by Nobel Prize-winning economist William Vickrey.

This auction method uses a mathematical model to treat all qualifying bids in an impartial way.

It is similar to the model used to auction Treasury bills, notes, and bonds.

Like a typical auction, the highest bidders win in this type of auction, but there are important differences.

In the OpenIPO auction, the entire auction is private, and winning bidders all pay the same price per share — the public offering price.