Listing on ASX can provide your company with access to a large and diverse pool of capital, as well as a range of benefits and services that can help you grow your business. In this blog, I will explain the steps and requirements for listing your company on Australian Securities Exchange (ASX).
Step 1: Decide if listing is right for you
Before you decide to list your company on ASX, you should consider your company’s strategy, goals, and readiness for being a public company. Listing on ASX involves meeting certain admission criteria, complying with the ASX Listing Rules, and disclosing information to the market on a regular basis. You should also weigh the benefits and costs of listing, such as increased visibility, liquidity, valuation, and access to capital, as well as fees, governance, and reporting obligations.
Step 2: Choose your listing method and structure
There are different ways to list your company on ASX, depending on your company’s size, stage, and sector. The most common methods are:
- Initial public offering (IPO): This involves issuing new shares to the public and raising capital from investors.
- Backdoor listing: This involves acquiring an existing ASX-listed company or entity and using its listing status to list your company.
- Dual listing: This involves listing your company on ASX as well as another exchange, such as the New Zealand Stock Exchange (NZX) or the Nasdaq Stock Market (NASDAQ).
You should also decide on the structure and governance of your company, such as the board composition, share classes, constitution, and shareholder rights.
Step 3: Appoint your advisors and prepare your documents
To list your company on ASX, you will need to appoint professional advisors who can guide you through the listing process and help you meet the regulatory and market requirements. These advisors may include:
- Lead manager or broker: This is the main advisor who will manage the offer, market the shares, and liaise with ASX and other parties.
- Lawyer: This is the legal advisor who will draft and review the legal documents, such as the prospectus, listing application, and contracts.
- Auditor: This is the financial advisor who will audit and verify the financial statements and reports of your company.
- Other advisors: These may include tax, accounting, valuation, or industry experts who can provide specific advice or services to your company.
Your advisors will help you prepare the documents that are required for listing, such as:
- Prospectus, product disclosure statement (PDS), or information memorandum (IM): This is the main document that provides information about your company, its business, financials, risks, and offer details to potential investors.
- Listing application and agreement: This is the form and contract that you submit to ASX to apply for listing and agree to comply with the ASX Listing Rules.
- Due diligence report: This is the report that summarises the due diligence process and findings that your advisors have conducted to verify the accuracy and completeness of the information in your documents.
- Other documents: These may include financial statements, business plans, corporate governance policies, or any other documents that ASX may request or that you may wish to provide.
Step 4: Meet the admission criteria and obtain ASX approval
To list your company on ASX, you must meet the minimum admission criteria that ASX has set to ensure the quality and integrity of the market. These criteria include:
- Company size: Your company must have either a profit of at least A$1 million over the past three years and A$500,000 over the last 12 months, or a net tangible assets of at least A$4 million, or a market capitalisation of at least A$15 million.
- Shareholder spread: Your company must have at least 300 non-affiliated shareholders, each holding at least A$2,000 worth of shares, and a free float of at least 20%.
- Working capital: Your company must have at least A$1.5 million of working capital if you are listing under the assets test, or sufficient working capital to carry out your stated objectives if you are listing under the profit test.
- Other requirements: Your company must also meet other requirements, such as having a satisfactory structure, governance, and disclosure practices, and having a suitable business and industry.
You must submit your listing application and documents to ASX for review and approval. ASX will assess your company’s suitability for listing and may ask for additional information or clarification. ASX will also assign a ticker code and a listing date for your company.
Step 5: Market your offer and allocate your shares
Once you have obtained ASX approval, you can launch your offer and market your shares to potential investors. You should follow the guidelines and regulations for advertising and promoting your offer, such as providing a copy of the prospectus, PDS, or IM, and not making any misleading or deceptive statements.
You should also decide on the pricing and allocation of your shares, such as whether you will use a fixed price, a bookbuild, or a combination of both, and how you will distribute the shares among different types of investors, such as retail, institutional, or existing shareholders.
Step 6: Complete your offer and commence trading
After you have completed your offer and allocated your shares, you must finalise the settlement and registration of the shares with ASX and the share registry. You must also provide ASX with the final details of your offer, such as the number of shares issued, the amount of capital raised, and the final shareholder spread.
You are now ready to commence trading on ASX. You should monitor the market performance of your shares and keep your investors and ASX informed of any material changes or events that may affect your company or its shares.
Listing your company on ASX can be a rewarding and beneficial experience for your company and its stakeholders. However, it also involves a complex and rigorous process that requires careful planning, preparation, and execution. By following the steps and requirements outlined in this blog, you can increase your chances of a successful listing and enjoy the advantages of being an ASX-listed company.
Step by step procedure of listing a company on AIM market of London Stock Exchange
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