Expected discounting in seasoned equity offers is a cost of uncertainty about firm value, marketing new shares, and acquiring information that raises the offer price. Stockholders incorporate predictable discounting in stock prices when equity offers are first announced. The surprise component of discounting, reflecting the lead bank's final adjustment to the offer price, releases information that often causes economically large price swings on the offer day. Disparities between the issuer's closing price and the price suggested in the lead bank's final order book are a primary source of information. The discount surprise appears to be used by lead banks to update capital suppliers with that eleventh-hour information before they commit their funds.