CURRENTLY SPEAKING

THE ROAD TO IPO ON THE ASX FOR

MULTINATIONAL COMPANIES

EP&B Webinar Series

Welcome
Welcome
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A link to a recording of the webinar will be available
David Ryan
Partner

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we will respond to your questions by email after the
webinar

Bridging Borders Webinar Series

Welcome
Overview
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Is an IPO and listing on the ASX right for your

company? - Advantages and Disadvantages of
Listing
David Ryan
Partner

The IPO Journey Procedures for Listing on the

ASX
What to watch out for Issues and Challenges

Bridging Borders Webinar Series

Is
an IPO and listing on the ASX right for
Welcome
your company?
CURRENTLY SPEAKING

Advantages

David Ryan
Partner

Disadvantages

Access to Australian capital

markets

Compliance with ASX

Listing Rules can be costly

Exit mechanism

Reduction in control

Increased market
awareness

Increased disclosure
requirements and financial
reporting

Equity incentive schemes to

incentivise employees

New responsibilities and

restrictions for management

Provides secondary market

liquidity and greater access
to funding

Share price is exposed to

stock market fluctuations

Bridging Borders Webinar Series

Welcome
The IPO journey
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Listing a
foreign
company on
the ASX
David Ryan
Partner

Incorporate a
new Australian
holding
company for the
group

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List the
existing
foreign
company on
the ASX

Welcome
The IPO journey
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Listing a
foreign
company on
the ASX
David Ryan
Partner

List the
existing
foreign
company on
the ASX

Incorporate a
new Australian
holding
company for the
group

'Foreign
exempt'
listing

Bridging Borders Webinar Series

Full ASX
listing

Welcome
The IPO journey
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'Foreign exempt' listing

For large companies with primary listing on another stock exchange
Must have either:
net tangible assets > $2 billion; OR
David Ryan

profit before tax > $200 million

Partner

Primary listing on a member of World Federation of Exchanges

1,000 holders of $500 or more
Listing rules for admission/fees/trading halts/ settlement apply other
rules do not apply
Parallel announcements required
Other requirements:
Register as a foreign company
Australian interests traded as (beneficial) CHESS Depositary Interests
(CDI)

Examples: Alcoa Inc. and Anglogold Ashanti Limited

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Welcome
The IPO journey
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Full ASX listing for a foreign entity

Rules the same as for "primary" listing on ASX

David Ryan

Any foreign company can seek a full ASX listing provided it meets
ASX's admission criteria including financial thresholds and shareholder
spread

Partner

Admission Criteria

General Requirement

Number of
Shareholders

Minimum 400 investors @ A$2,000 or

Minimum 350 investors @ A$2,000 and at least 25% held by
unrelated parties or
Minimum 300 investors @ A$2,000 and at least 50% held by
unrelated parties

Company Size

Profit Test

A$1 million aggregated profit over past 3 years and

A$400,000 consolidated profit over last 12 months
or

Assets Test

A$3 million net tangible assets after deducting costs

of fundraising
Or
A$10 million market capitalisation

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Welcome
The IPO journey
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Full ASX listing (cont.)

Specific requirements
Disclosure document (ie. Prospectus)
Constitution to comply, or adopt Appendix 15A
Disclosure of takeovers and substantial shareholding regime

David Ryan
Partner

Disclosure of governance regime

ASX waivers often required

Australian share sub-register:

CHESS sub-registry for Bermuda, NZ, PNG corporations
Others: CDIs

Financials: disclose differences in accounting standards (investors

would expect AUD financials)

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Welcome
The IPO journey
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Trading in CHESS Depository Interests

Trade as a form of depositary receipt CHESS Depositary Interest (CDI)
Same economic benefits of actual ownership with key differences set out below

Shares
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Partner

Shareholders hold legal title

Settled through ASX's electronic

trading system, CHESS

Entitled to attend the shareholder

meetings and vote in person

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CDIs

CDI holders hold beneficial title to

the underlying shares with legal title
to the shares held by CHESS
Depository Nominees (CDN), a
subsidiary of ASX

Same voting rights but manner of

exercising voting rights different:

Instruct CDN to vote in a

particular manner

Appoint themselves as CDN's

proxy

Convert CDIs into a holding of

Shares prior to AGM
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Welcome
The IPO journey
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Examples of foreign companies listed on ASX

Dual Listing

Primary Listing

Foreign Exempt

David Ryan
Partner

Bridging Borders Webinar Series

A2 Milk Company Limited

(ASX and NZX)

GI Dynamics, Inc (US

company listed on the
ASX)

Alcoa Inc

TOWER Limited (ASX and

NZX)

Anglogold Ashati
Limited

Vista Group International

Limited

Unilife Corporation (US

company listed on the
ASX)

Reva Medical, Inc (US

company listed on the
ASX)

Heartware International,
Inc. (US company listed
on the ASX)

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Welcome
The IPO journey
CURRENTLY SPEAKING

A typical timetable for the IPO process

Sign UWA/OMA, lodge prospectus
with ASIC and lodge listing
application with ASX
Commence
Pre-marketing

David Ryan
Partner

Is the timing right?

Offer period /
marketing roadshows

Restructure
Consider
alternative options
(eg trade sale)

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Commence
due diligence

Prospectus
preparation

Prospectus
exposure period

Allocation, closing
and listing

Planning

Execution

Completion

1 2 months

3 4 months

2 weeks

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Welcome
Offer Structuring
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Pricing and
institutional
engagement

David Ryan
Partner

Underwritten
/ lead
managed?

Sell down /
new issue /
both?

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Key
structuring
questions

Ideal register
composition
(cornerstone
investors)

Domestic
offer only /
tap
international
markets?

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Welcome
Being IPO ready
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IPO story
David Ryan

Develop "IPO story" early to ensure alignment of marketing

efforts
Identify operational "KPIs" to support IPO story
Identify source and use of funds and growth plans
Gather information needed to prepare disclosure document

Partner

Structure &
tax

Identify vehicle for listing and convert to public company (if

necessary)
Identify key tax and corporate structuring issues
Determine optimal corporate structure, financing arrangements
and distribution policy

Financial
information

Identify accounting challenges

Agree level of financial information to be included in disclosure
document (historical information, pro-forma adjustments and
forecasts)

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Welcome
Being IPO ready
CURRENTLY SPEAKING

Offer
structure
David Ryan
Partner

Corporate
governance

Listed
company
Infrastructure

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Determine optimal offer structure sell down and/or raise new

capital?
Institutional, broker firm, retail offers
Identify offer jurisdictions
Bookbuild, pricing and allocations
Determine escrow requirements

Establish appropriate Board and Board Committees (Rem, Audit, etc)

Independent non-executive directors
Document corporate governance policies / risk management protocols
Document access, insurance and indemnity arrangements (check IPO
cover)
ASX Corporate Governance Principles & Recommendations
Adopt listed company constitution
Identify necessary waivers
Establish systems to enable compliance with financial reporting and
disclosure obligations
Develop strategic investor relations program
Share registry

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Welcome
Being IPO ready
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Management
and
employees

Identify management with requisite expertise to undertake IPO

and run listed company
Prepare executive service contracts
Determine appropriate executive incentive arrangements

Underwriting /
Offer
Management

Identify and engage underwriters/offer managers

Prepare underwriting/offer management agreements

David Ryan
Partner

Advisers

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Legal counsel / tax advisers

Independent accountant
Technical experts
PR/Communications adviser

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Welcome
Being IPO ready
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Due Diligence Process

David Ryan
Partner

Bridging Borders Webinar Series

Due diligence
committee

DDPM

Key issues register Verification

DDC Report/
sign offs

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Welcome
Issues and Challenges
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Due Diligence Process

Why conduct due diligence?

David Ryan
Partner

Bridging Borders Webinar Series

To ensure
there are no
misleading or
deceptive
statements or
omissions

To verify
statements of
fact and ensure
reasonable
grounds for
forward looking
statements

To assist in
establishing
due diligence
defence

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Welcome
Issues and Challenges
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Prospectus Liability

David Ryan
Partner

Bridging Borders Webinar Series

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Welcome
Issues and Challenges
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Life as an ASX Listed Entity

ASX 15% (or 25% if applicable) limit
Ability to undertake rights issue or share purchase plan
Approval required for issues to related parties (eg. directors)

Share
Issues

David Ryan
Partner

ASX imposed shareholder approval requirements

Related
parties

Continuous
disclosure

Financial
reporting

Termination
benefits

Bridging Borders Webinar Series

Immediately inform the market of information that would

have a material effect on the price or value of securities

Timing and format of financial reporting requirements

Restrictions imposed under ASX Listing Rules

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Welcome
Issues and Challenges
CURRENTLY SPEAKING

Ongoing requirements for Foreign Companies

Same continuing obligations as Australian companies, unless
foreign exempt listing

David Ryan
Partner

ASX may impose additional disclosure requirements or waive

certain Listing Rules
Eg. Australian takeover and substantial shareholder provisions
do not apply to companies incorporated outside Australia, ASX
requires a statement of that fact in each annual report and an
undertaking to disclose to the market promptly

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Welcome
Key Takeaways
CURRENTLY SPEAKING

Develop a good business plan

and credible investment story

Start preparations early and view the

IPO as a continuing process rather
than a one-off financial event

David Ryan
Partner

Be realistic it is
important to
understand the
amount of work and
time involved in
preparing for an IPO

Determine whether an IPO

is the right option

Bridging Borders Webinar Series

Appoint an experienced
IPO team early in the
process (ie. lead
managers, underwriters,
lawyers, accountants
etc)

It is not as complicated as
people often think

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Welcome
THANK YOU
CURRENTLY SPEAKING

David Ryan
Partner

David Ryan
Partner

Bridging Borders Webinar Series

THANK YOU

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