An issuance of securities by a company that already has had an initial public offering (IPO). It involves the sale of a block of existing securities whose proceeds go to the existing holders rather than to the issuing company. A bulky secondary offering may put pressure on the security’s price until the additional quantity (of shares or bonds) have been absorbed by the market. Securities from secondary offerings are often sold to institutional investors or retail networks through a syndicate (mainly consisting of a group of bookrunners or lead managers). The syndicate members underwrite the offering in their role as broker-dealers. The price of the secondary offering is set by a negotiation between the issuer and the bookrunners.

It is also called secondary distribution or follow-on offering.