Cantor Entertainment Technology, Inc., changed its game plan and withdrew its initial public offering on Monday, May 25. The Las Vegas-based mobile gaming provider intends to confidentially submit a new proposal under the Jumpstart Our Business Strength (JOBS) Act. According to Renaissance Capital, Cantor Entertainment is the first company to withdraw its IPO plans because of the act and openly revealed its intention to pursue an offering as a confidential filer.
The JOBS Act, which became law in April, gives emerging-growth companies more flexibility on becoming public entities. Startups that are generating less than $1 billion in revenues would not have to worry about some regulatory strains for the first five years after they go public. Once a company goes beyond $1 billion in revenues, it would have a one-year transition, at which point it would have to comply with Securities and Exchange Commission regulations. However, if the company remains below the $1 billion threshold, it would never have to incur that cost.