Question

General Electric (GE) wishes to raise capital by the sale of $500 million in new corporate bonds. May GE do so without offering the bonds to the general public under the securities laws?

Group of answer choices

No, the bonds must be offered to the general public but may be exempt from registration under the 1934 Securities Exchange Act

Yes, the bonds may be offered via private placement to accredited investors but accredited investors must receive a prospectus.

Yes, the bonds may be offered via private placement to qualified institutional buyers and are exempt under the 1933 Securities Act

No, the bonds must be offered for sale to the general public and registration is required under the 1933 Securities Act

Answer 1

Answer -

The correct Option is third option

Yes, the bonds may be offered via private placement to qualified institutional buyers and are exempt under the 1933 Securities Act.

The General Electric (GE) can raise capital by the sale of $500 million in new corporate bonds without offering to general public via private placement under Securities Act 1933.

The most common exemptions from the registration requirements under 1933 Securities Act are

Private offerings to a limited number of persons or institutions, Offerings of limited size, Intrastate offerings and Securities of municipal, state, and federal governments.

The other Options are incorrect

The securities Act 1934 regulates secondary market transactions, used or previously issued securities