Rules keep public offer private

Last year, Twitter would not have been able to send its tweet heard around the world.

Last year, Twitter would not have been able to send its tweet heard around the world.

Last week the social network announced in its 140-character way that it was preparing to sell shares to the public and that it had confidentially filed the necessary paperwork with regulators. A law adopted in April 2012 allowed Twitter to act in secret and keep under wraps some of its key financial data.

The new law allows firms with annual revenue of less than $US1 billion temporarily to bypass some regulatory hurdles as they file initial public offerings (IPOs). The idea is to make it easier for these "emerging growth companies" to go public, grow and hire more workers.

The companies have a menu of options they can select from, and Twitter chose a popular one by confidentially submitting the IPO paperwork to the Securities and Exchange Commission.

The financial details in that paperwork - such as whether the firm is profitable, what it pays its employees or what kinds of risks it faces - will not be made public until 21 days before Twitter's roadshow, when it starts to market itself to potential investors. About two-thirds of the 132 IPOs priced in the US this year opted for confidential filings.

The relaxed rules only apply for up to five years or possibly less if a company's revenue hits $US1b or it meets other criteria.

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