The process of listing a company on the ESE begins with appointing a Sponsoring Broker among one of the licensed brokers. All submissions and applications to the ESE for a listing are submitted through a Sponsoring Broker; who acts as a medium of communication between the exchange and the issuer for its entire listed life.
The Sponsoring Broker also assists the applicant with assembling a team of advisors who will be involved in the process of listing, and these include:
Auditors • Bankers; • Corporate Finance Experts / Financial Arrangers ; • Lawyers; • Reporting Accountants; •
Initial Public Offering: An Initial Public Offering (IPO) occurs when a company offers its shares for sale to the public on the ESE for the very first time. When a company decides to have an IPO, it is said to be “Going Public”. Going Public broadly describes the process through which a company converts itself from a private limited company to a public limited company (Plc) and subsequently sells its shares to the general public via an IPO over a licensed stock exchange.
Special Purpose Acquisition Company (SPAC): A Special Purpose Acquisition Company (SPAC) is a company with no operations of its own and comprising only cash, on condition that the company buys operating assets within two years (24 months). The requirement is that they should be led by management with previous experience in mergers and acquisitions, operational background, come from investment banks or private equity firms, or have been former executives. Investors buy into the management team and its ability to identify good assets which will produce good returns. It also gives the management team the opportunity for efficient decision-making when they do get an asset.
Introduction: This is a method of listing a company without the company offering new or existing shares to the public. A company will use this method if the required number of shareholders already complies with the ESE Equity Listings Requirements. With this method, there is no inflow of capital to the company or to its shareholders arising from the listing.
Offer for Sale: An offer for sale is a method of listing where existing shareholders of the company invite the public to subscribe to their shares which are already in issue. An offer for sale does not result in new issuance of shares, rather already existing shareholders re-sell some of the shares they hold. This is usually done to restructure the shareholding of the company so that the company can meet the public float or shareholding requirements of the ESE. It can also be used as an avenue for founding shareholders to cash-in on their investment by reducing their shareholding in the company.
Offer for Subscription: This is an invitation by the company to the public to subscribe for shares in the company. With this method, the company issues new shares and sells them to new investors other than its existing shareholders. This way the shareholding structure of a company is adjusted and the proceeds from the transaction accrue to the company as equity capital. This is employed by companies that list in order to raise capital to expand their operations.
Placing: Placing is a method of listing a company that involves the marketing of shares already in issue but not listed, to specified investors, and does not involve an offer to the public or to existing shareholders. It differs with Offer for Sale and Offer for Subscription in that the shares are offered to a select group of investors and not to the general public. Usually, placing is undertaken through private placement with institutional investors as opposed to an Initial Public Offering (IPO).
Private Placement: Private placement is an offer of securities to a small number of select and private investors as a way of raising capital.
CONTINUING OBLIGATIONS: ESE regards the timely disclosure of relevant information as of prime importance in the operation of an efficient market. There is a general requirement to disclose to the market any information that is material. A listed entity must immediately disseminate to the market via the ESE News Portal (ESENP) any information that it becomes aware of, which a reasonable person would expect to have material effect on the price or value of the entity’s securities. This information might reasonably influence investment decisions.
Considerable care has been taken to make certain that the information presented in this publication is accurate and representative of the facts as they really are. Readers are advised to consult specialists on the actual situation.