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The IPO Guide page i
The IPO GuideA Guide to an initial public offering on theAustralian Securities Exchange
The IPO Guide page ii
March 2014
IMPORTANT NOTICE:
This Guide does not constitute legal or other advice. The information contained in thisdocument is intended as a Guide to the process of listing a company on the ASX, andis not specific to the needs or requirements of any individual company. You should notrely on or act on the information contained in this Guide without obtaining professionaladvice specific to your company. To the extent permitted by law, Maddocks, itspartners, employees and agents accept no liability and disclaim all responsibility forthe consequences of you or anyone else relying on any information contained in thisGuide or for any decision based on it or by any reference to this Guide.
If you would like to discuss any information in this Guide or obtain advice on anycommercial matter, please contact:
Andrew McNee | PartnerCommercialDirect 61 2 9291 6123 | Facsimile 61 2 9221 0872 | Mobile 61 419 426 016Email [email protected]
Ron Smooker | PartnerCommercialDirect 61 3 9258 3863 | Facsimile 61 3 9258 3666 | Mobile 61 488 128 148Email [email protected]
The IPO Guide page i
Contents
1. Introduction .............................................................................................................................1
Purpose of the Maddocks IPO Guide .......................................................................................1How can we assist you?............................................................................................................1
2. Why list? Advantages and disadvantages of an IPO ..........................................................2
Reasons for considering an IPO ...............................................................................................2Reasons for not carrying out an IPO.........................................................................................3
3. When should I initiate an IPO and how long will it take?....................................................4
Timing........................................................................................................................................4Restructure of the company......................................................................................................4How long will it take?.................................................................................................................4
4. Criteria for listing ....................................................................................................................5
Requirements for ASX Listing...................................................................................................5The profit test ............................................................................................................................6The asset test............................................................................................................................6
5. Criteria for quotation ..............................................................................................................8
On admission and subsequent quotation..................................................................................8Requirements for quotation on admission ................................................................................8
6. Preparing a company for an IPO ...........................................................................................9
IPO team ...................................................................................................................................9Restructure of the company......................................................................................................9Cultural and structural changes ................................................................................................9Tax implications ........................................................................................................................9Financial reports and accounts .................................................................................................9Review of corporate governance practices and policies.........................................................10
7. The IPO team .........................................................................................................................12
Corporate adviser, investment bank or stockbroker ...............................................................12Underwriter..............................................................................................................................12Legal counsel ..........................................................................................................................12Accountants ............................................................................................................................12Share registry..........................................................................................................................12Public relations / communications consultants .......................................................................12Technical experts ....................................................................................................................12
8. Structuring the IPO ...............................................................................................................13
Structuring...............................................................................................................................13Issue of new shares and/or sell-down of existing shares .......................................................13Consultation with ASX.............................................................................................................13
9. Due diligence.........................................................................................................................14
The due diligence committee ..................................................................................................14The due diligence defence for prospectuses ..........................................................................14
10. The prospectus .....................................................................................................................15
Is a prospectus required?........................................................................................................15ASX Listing Rule 1.1 ...............................................................................................................15Types of disclosure documents ..............................................................................................16Preparation of the prospectus.................................................................................................16Information to be included in the prospectus ..........................................................................17Drafting the prospectus ...........................................................................................................17
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Date of the prospectus ............................................................................................................18Consents .................................................................................................................................18Application to accompany prospectus ....................................................................................18Pre-lodgement advertising and publicity .................................................................................18Lodgement of the prospectus .................................................................................................18Key dates ................................................................................................................................18
11. Applying to list ......................................................................................................................20
Time limit .................................................................................................................................20Failure to apply within time limit ..............................................................................................20Application...............................................................................................................................20Maximum number of securities ...............................................................................................21Request for additional information ..........................................................................................21Listing fees ..............................................................................................................................21Refund if application not accepted or withdrawn ....................................................................23Publication of application ........................................................................................................23
12. Restricted securities.............................................................................................................24
What are restricted securities? ...............................................................................................24Dealing with restricted securities ............................................................................................24When restrictions do not apply................................................................................................25Restriction agreements ...........................................................................................................26Escrow.....................................................................................................................................26Disclosure of information to ASX ............................................................................................26Seeking advice........................................................................................................................26
13. The IPO period.......................................................................................................................27
Key dates ................................................................................................................................27The exposure period ...............................................................................................................27Extension of the exposure period ...........................................................................................27Applications must not be 'accepted' during the exposure period............................................28Warning to be provided if the prospectus is circulated during the exposure period ...............28The offer period.......................................................................................................................28Application moneys to be held on trust ...................................................................................29Post-lodgement advertising and publicity ...............................................................................29ASIC 'stop orders' ...................................................................................................................29The need for a supplementary or replacement prospectus ....................................................30Form of supplementary prospectus ........................................................................................31Form of replacement prospectus ............................................................................................31Withdrawing an IPO ................................................................................................................31
14. Admission..............................................................................................................................32
Outcome of application ...........................................................................................................32Conditions precedent to admission.........................................................................................32Closing the offer ......................................................................................................................32Failure to reach minimum subscription amount within four months........................................32Allotting and issuing the shares ..............................................................................................32Sufficient shareholder spread .................................................................................................33Admission................................................................................................................................33
15. Commencement of trading ..................................................................................................34
Outcome of decision ...............................................................................................................34Conditions precedent to quotation ..........................................................................................34Despatch of holding statements..............................................................................................34Failure to admit securities to quotation within three months...................................................34Quotation.................................................................................................................................34
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16. Ongoing obligations .............................................................................................................35
Continuous disclosure.............................................................................................................35Periodic disclosure ..................................................................................................................37
17. Dual listings...........................................................................................................................38
What is a dual listing? .............................................................................................................38Advantages of dual listing .......................................................................................................38Disadvantages of dual listing ..................................................................................................38Foreign companies listing on ASX ..........................................................................................38Criteria for ASX Foreign Exempt Listing .................................................................................39Criteria for ASX Listing (Foreign Entities) ...............................................................................39Disclosure and reporting obligations.......................................................................................39Trading of securities on two markets ......................................................................................40Chi-X Australia: a new market operator ..................................................................................40
18. Frequently asked questions ................................................................................................41
At what time should an IPO be conducted?............................................................................41What size does my company need to be to apply for listing?.................................................41My company has issued a prospectus, when do I need to make my application to ASX foradmission? ..............................................................................................................................41Who should I obtain advice from in relation to my proposed IPO?.........................................41When is a prospectus required? .............................................................................................41Can I advertise the offer before lodging a prospectus with ASIC? .........................................41What are restricted securities and why do I need to be aware of them?................................41What is the maximum period for an IPO?...............................................................................42Do I get a refund if my application is rejected?.......................................................................42How can an IPO be amended?...............................................................................................42My company's IPO failed to reach the minimum subscription. What can I do?......................42My company is now ASX Listed. What happens now?...........................................................42Can my company be listed on more than one securities exchange? .....................................42What are the stages of the IPO process?...............................................................................42
Appendix 1: The IPO Process .............................................................................................................43
If you would like to access this document in full, please email [email protected] arrange for a full version to be provided to you.
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