Capital raisings via Initial Public Offerings (IPOs)


This year has seen a re-emergence of interest in IPOs. With $16.8 billion raised from IPOs this year from over 90 floats (up from $10.8 billion raised last year), IPOs are again becoming an attractive way to raise capital. Just recently, Medibank Private raised $5.7 billion from its float and other companies are likely to follow its lead and launch IPOs this month and early in 2015. Some highlights include online retailer Surfstitch which is seeking to raise over $83 million and cloud platform Aconex with a $50 million offer, who are both seeking to float on the ASX later this month.

The ASX is Australia’s premier stock exchange. Below are some of the benefits of listing on the ASX.

The ability to access capital from retail and institutional investors

Listings on the ASX are usually conducted with the assistance of a stockbroking firm who will often underwrite the offer and sell the securities through their distribution network. Stockbrokers and financial planners are unlikely to recommend securities to their clients that are not listed on the ASX or rated by a rating agency.


The ASX is by far the largest securities market in Australia. Trades are settled electronically three trading days after the transaction settles.

Corporate governance

Listed companies are required to implement corporate governance policies and continually update the market on the performance of the company.

Enhanced credibility

Listing on the ASX can enhance your credibility with customers, business partners, suppliers, investors and lenders.

Multi-jurisdictional capital raisings

Astute companies are seeking to raise funds domestically on the ASX, in tandem with overseas capital raisings. This allows companies to access capital from larger overseas financial markets, such as Singapore. Singapore laws permit Australian companies to provide their prospectus or product disclosure statement to Singapore investors in conjunction with simple ‘wrap documents’. This allows Australian issuers to access Singapore’s financial market with a low cost ‘bolt on’ to their Australian offer document.

Lawyers typically provide the following services in connection with the IPO process:

  • project management;
  • drafting the prospectus or product disclosure statement;
  • undertaking legal due diligence on the company to resolve any material issues prior to the float;
  • pre-IPO restructuring;
  • negotiating with underwriters; and
  • liaising with the ASX in relation to admission requirements.

Sajen Legal has recently completed two capital raising. Click here to find out more about these transactions.

If you have any questions regarding capital raisings or IPOs please don’t hesitate to contact me.

Tagged in: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

You may also be interested in:

6 Things You Can Expect When Declaring Bankruptcy

Declaring bankruptcy should be your last resort when you are faced with financial difficulties, whether as an individual or as a business owner. It is not exactly a “Get Out of Jail Free” card, as it comes with many adverse consequences, which may significantly impact your financial standing over a considerable period. So what consequences continue reading

How do you determine if a company is insolvent?

The answer to the question “How do you determine if a company is insolvent?” is important because there are serious consequences for a director if debts are incurred after the company has become insolvent, including civil penalties, compensation proceedings and criminal charges. However, it is often difficult to know when a company has crossed the continue reading

What to do if you receive an ATO Director Penalty Notice

Did you know that company directors may potentially become personally liable for unremitted Pay As You Go (PAYG) deductions and Superannuation Guarantee Charges (SGCs)? The Australian Taxation Office (ATO) has significant powers to recover a company’s unpaid liabilities personally through its directors and may issue a Director Penalty Notice (DPN). This article focuses on the continue reading

Liability Limited by a scheme approved under professional standards legislation | Website by VA