Download 기업의 국내외 상장 ipo

건국대학교 벤쳐전문기술
전략적 제휴와 M&A 연구
강의 목표와 계획
강의 목표

Corporate Finance

Communication with Equity Investor, including overseas investor

Cross border and cultural experience in finance industry
강의 계획

주제의 제시와 토론

평점방법: 출석 40, 강의참여 20, 중간과제물 20, 기말 과제물 20

중간과제물:


투자가 자금유치를 전제로 한 사업제안서 작성
기말과제물:

중간과제물때 제안된 사업내용의 상장 및 인수합병 전략 - Valuation, 인수합병방안 및
대상회사선정, 자금조달 방안, 기관투자가를 위한 Exit 방안, 등등 포함
2
Hans Kim
주제별 강의 계획
1. 기업금융과 IR
9. M&A 1
2. 기업금융과 IR
10. M&A 2
3. 기업의 국내외 상장
11. 적대적 M&A
4. 초빙강사 1: 엔터테인먼트시장
12. Hedge Fund 의 한국금융기관 인수
5. Valuation 1
13. 초빙강사 3 (또는) Investor-state claim
6. Valuation 2
14. 지배구조펀드에 대한 이해
7. 초빙강사 2: Due Diligence 실무
15. 전략적 제휴와 JV
8. 중간 시험 - 과제물 제출
16. 기말 시험 - 과제물 제출
Note: 강의 내용과 순서가 바뀔 수도 있음
3
Hans Kim
IPO

Why IPO ?

IPO 절차와 비용

해외시장 IPO
4
Hans Kim
IPO
Why IPO ?
5
Hans Kim
IPO_ Why IPO?_ Motives of IPO

The motives of IPO (Dr. Henry Servaes, 2001)

Company needs new financing

Current sources of financing have been exhausted (Bank Financing, Venture
Capital)

Founders want to diversify and cash out partially

The increased liquidity in Company stock increases its value

The liquidity may also make it easier to do further acquisition; acquisition
currency

Venture Capitalist wants cash out



In the western market, often Venture Capitalist does not sell out and
makes distribution to partners after IPO
What about in Korean market?  Golden Bridge의 대우부품사례
Take advantage of overvaluation in market
6
Hans Kim
IPO_ Why IPO?_Case of IPO motives

Case of “acquisition currency” and “overvaluation” in the market after IPO
글로비스 (086280)


7
현대차 물류 전문업체
현대차 그룹의 경영권 상속을
위한 상장이라는 견해?
Hans Kim
IPO_ Why IPO? _Disadvantage of IPO

Why MNCs in Korea tend to go back to Private company after acquiring public company ?

Going public is a costly process



Cost of IPO

North America 7%

Europe  3.59% (931 IPOs 1992 – 1999)

Asia Pacific  3.09% (430 IPOs 1992 – 1999)

Korea  ??
Under pricing  예컨대, 시장시초거래가 117$  공개가 100$  증권사 비용 지불 이후
가격 93$  기타 비용 지불 이후 가격 90$ = 회사가 실제 조달한 몫 = 결국, 시초가 117$
보다 27$ 이나 적은 가격

Cost of managing the status of public company

Cost of Human resources for IR activity

Management cost of maintaining the share price properly
Vulnerable to control contests

Increased disclosure

Diversified shareholder structure
8
Hans Kim
IPO
IPO 절차와 비용
9
Hans Kim
KOSPI Information
10
Hans Kim
Lead Manager’s role
11
Hans Kim
Listing requirement and issues

Major listing issues

Listing requirement & issues
12
Hans Kim
Listing Requirement & Issues
13
Hans Kim
Listing Requirement & Issues
14
Hans Kim
Listing Requirement & Issues
15
Hans Kim
Listing Requirement & Issues
16
Hans Kim
Listing Requirement & Issues
17
Hans Kim
Listing Requirement & Issues
18
Hans Kim
Listing Requirement & Issues
19
Hans Kim
Listing Schedule & Cost

무상증자의 의의
20
Hans Kim
코스닥 _ 주요 업무 일정도
21
Hans Kim
Listing Schedule & Cost

무상증자의 의의
22
Hans Kim
IPO_ 코스닥 상장 절차 _코스닥위원회, 심의결정원칙, 유형별 기준


코스닥 등록의 의의  증권업협회가 비상장법인중 일정한 요건을 구비한 회사에 대하여 증권회사의 신청에
의하여 협회중개시장의 매매 대상물로 승인하는 행위
코스닥 위원회



협회중개시장의 운영기준, 협회등록 심의 & 취소, 불성실 공시법인 제재등 심의 의결
1인 상임위원 + 10인 비상임 위원 ( 학계대표 등 전문가 5 + 협회임원 1+중소기업진흥공단임원 1+등록법인중
벤쳐기업대표 1 + 기관투자자 대표 1 + 중개회사임원 1)
심의 결정 원칙

외형요건 (협회중개시장 운영규정 제 4조 1항 1호 및 15호) 에 대한 심의결정기준


질적 요건 (운영규정 제 4조 1항 16호) 에 대한 심의 결정 기준


구분: 승인 및 기각
구분: 승인 및 재심의, 보류, 기각
심의결정 유형별 기준

승인  협회중개시장 운영규정에서 정하는 협회등록 심사요건을 구비하고 있다고 판단되는 회사

재심의 협회등록 질적 심사요건 중 특정부분에 대한 추가적 검토 & 확인이 필요하다고 판단되는 회사

보류  질적 심사요건 중 미흡한 사유가 있다고 판단되나 단기간에 그 충족여부의 확인이 가능한 회사

기각  외형요건 미비 및 심사요건 중 결격사유 있다고 판단되나 단기간에 그 해소가 불가능한 회사
23
Hans Kim
IPO_ 코스닥상장 심사 요건

코스닥 등록 심사 요건  협회등의 홈페이지 참고 및 별도 참고 자료 검토

등록예비심사 미승인 사례

사업성검증미흡

매출규모 미미

주요제품의 매출 중단  직전 사업 년도 매출 50%차지하는 사업부문의 매출 중단

주요매출처의 불확실성  직전 사업 년도 매출 77% 차지하는 수요처의 재무내용 부실

직전사업연도에만 매출급증  직전 사업 년도 매출급증 (300%) 이 단일 건에 52% 의지

신규사업에 대한 불확실성  신규사업이 매출의 80%로 미래 불확실성 존재

수익성 검증 미흡  당해1/4분기 주력사업 매출 10억에 분기손실 2억 시현

관계회사 위험에 노출  직전 사업 년도 관계사 부채비율 2,600%

재무안정성 미흡  직전 사업 년도 유동비율이 동업계 평균 50% 미만

재무자료 신뢰성 미흡


매출채권 관련 위험 최근 3년간 매출채권 및 재고자산의 지속적 증가  매출채권이 자기자본의 356%, 재고자산이
자기자본의 466%)
경영의 투명성 미흡  임원 부도, CB를 대주주에게 저가 매도, 유증 대금 대주주에 대여
24
Hans Kim
IPO_ 코스닥상장 심사 요건_ 통계자료
25
Hans Kim
IPO_ 유 / 무상 증자 해설
유 / 무상 증자 해설

유상증자

일반 공모 증자

제 3자 배정 유상증자

무상증자
26
Hans Kim
IPO_ 유 / 무상 증자 해설

유상증자

일반 공모 증자

제 3자 배정 유상증자

무상증자

유상증자의 의의



발행된 신주의 대가가 회사내로 납입됨으로써 회사재산이 증가하며, 발행 신주가 제3 자에게
인수되는 경우 회사의 구성원 (주주) 수도 증가
인수방법에 의한 유상증자의 분류

주주배정방식  신주 인수권을 구주주에게 부여  가장 일반적

주주우선 공모 방식 주주에게 우선 배정하고 실권된 주는 공모하는 방식



유상증자란 주식회사 성립 이후에 자금조달의 목적으로 정관상 발행예정주식총수의
범위내에서 미 발행주식을 발행 하는 것
일반 공모 증자 방식  제3자 배정과 같이 기존주주배제하고 일반 불특정다수인을 대상으로
공개모집방식으로 유상증자실시  IPO 가 이에 해당
제 3 자 배정  정관 또는 주총 특별결의 사항  기존 주주 배제 하고 특정 제 3자에게
배정방식  외자유치의 일반적 방식  경영권 및 기존주주에 영향
발행가에 의한 유상증자의 분류

액면가 유증 방식  정관에 정한 액면가 기준으로 하는 유상증자

시가발행 방식 증권시장에 형성된 주가에 연계하여 유상증자

액면미달 발행 방식 자본충실원칙(상법330조) 에 따라 할인발행은 엄격히 금지 회사의
어려운 경영상태로 자금조달이 긴박한 경우에 한해 엄격한 요건아래 허용
27
Hans Kim
IPO_ 유 / 무상 증자 해설
일반 공모

유상증자

일반 공모 증자

의의  구주주의 신주 인수권을 배제하고 신주 전량을 일반투자자를 대상으로 공모하는 방식

제 3자 배정 유상증자

발행가액 결정

무상증자



할인율  100/30 이내

결정시점  청약일전 제 5 거래일을 기산일로 결정

계산식  발행가 = 기준주가 X (1- 할인율)

기준주가  MAX {1 달 거래가중평균종가, 1 주 거래가중평균종가, 기산일 종가}
제 3 자 배정 유상증자

의의  회사 정관에 따른 신주인수권 배제 별도 규정 또는 주총 특별결의 사항  회사 의
합작선등 특별관계에 있는 자에게 신주 인수권 부여  외자유치

경영권 분쟁시 우호세력 확보

발행가액 결정

할인율  100/10 이내

결정시점  유증 이사회 결의일을 기산일로 결정

계산식  발행가 = 기준주가 X (1 – 할인율)

기준주가  MIN {(1 달 거래가중평균종가 + 1주 거래가중평균종가 + 기산일 종가) /3,
최종일 종가}
28
Hans Kim
IPO_ 유 / 무상 증자 해설

유상증자

일반 공모 증자

제 3자 배정 유상증자

무상증자

무상증자의 의의




자본금으로 변하는 준비금을 액면으로 나눈 수 만큼 신주 발행하는 증자

발행된 신주는 구 주주에게 소유 주식 비율로 비례해서 배분
무상증자의 목적

회사의 자본구성을 시정

사내 유보규모의 적정화

주주에 대한 이익의 환원

주식의 유동성 확보

자본금 증가를 통한 대외 신용도 제고
무상증자의 재원


회사의 순자산에는 아무런 변화 없이 준비금의 일부 또는 전부를
자본금으로 변하는 대차대조표 상의 항목변경에 불과
법정준비금  이익준비금, 자본준비금, 재평가적립금 등
결의기관  이사회 결의로 가능  법정준비금이 아닌 임의 적립금을
이익준비금으로 항목 변경하여 무상 증자 할 때는 주총결의 필요
29
Hans Kim
IPO
해외시장 IPO
30
Hans Kim
1
Overview
31
Hans Kim
Overview of Capital Markets
A Share
Private Equity
Domestic
B Share
Listing
Big Red Chip
Small &
Medium Board
Company
Direct Listing
Hong Kong
Main Board
Big H Share
GEM
Small Red Chip
Overseas
Singapore
Listing
Indirect Listing
United Kingdom
Small H Share
(Reverse Takeover)
United States
32
Hans Kim
Key considerations for selecting listing location
Growth strategy /

In selecting a listing location, companies should consider corporate strategy and
how the listing location would impact corporate image

What’s the likelihood of a successful IPO? Can it be completed in a relatively
short time horizon?

Is the valuation fair (especially compared to other similarly listed companies)? Is
the amount raised enough to fund corporate development needs?

Cost of raising equity (underwriting fee, listing fees, lawyers, auditors, evaluation,
PR, printing costs), and cost of maintaining a listing, including internal controls,
financial reporting and satisfying local regulations

How easy is it to access the capital markets through a follow-on offering and the
usual amount of a follow-on offering
reputation
Listing requirements /
processing times
Valuation / PE / Fund
raised
Cost of listing
Follow on offerings
33
Hans Kim
International markets comparison
AIM
HK Main Board
GEM
Singapore Stock
Exchange
NASDAQ
Financial requirements
None
High
Low
Medium
High
Operational requirements
None
High
High
Medium
High
Minimum market
capitalization
None
US$24m (HK$200m)
US$5.9m
None
US$8m free float
Time required
to list
3mth – 6mth
6mth – 9mth
6mth – 9mth
6mth
12mth
Listing cost
(ex-commission)
US$0.45m
(GBP0.25m)
US$1.2m (HK$10m)
US$1.2m (HK$10m)
US$0.75m (S$1.25m)
US$0.6m
Monthly liquidity
(Turnover / market
capitalization) in 2004
7%
77%
3%
14%
24%
Number of Chinese
companies listed
15
173
45
88
24
(8 IPOs, 7 reverse
takeovers)
Source: PwC, BDA research
Data as of December 2005
34
Hans Kim
2
Hong Kong Listing
35
Hans Kim
Hong Kong listing (Main Board) – listing requirements
Financial capability

Candidate must fulfill one of the three tests in order to satisfy the financial attributes requirement:

Profit:
Not less than US$2.6m (HK$20m) for the most recent year; AND

Profit:
Not less than US$3.8m (HK$30m) in aggregate for the 2 preceding years
Market
capitalization /
revenue test

Market cap: Not less than US$513m (HK$4bn) at the time of listing; AND

Revenue:
Market
capitalization /
revenue / cash
flow test

Market cap: Not less than US$256m (HK$2bn) at the time of listing; AND

Revenue:
Not less than US$64m (HK$500m) revenue from principal activities for the most recent financial year;
AND

Cash flow:
Not less than US$13m (HK$100m) inflow from operating activities in aggregate for the 3 preceding
financial years
Profit test
Not less than US$64m (HK$500m) revenue from principal activities for the most recent financial year;
AND
Ownership and management continuity

Maintain a trading record period of not less than 3 financial years; AND

Demonstrate management continuity during the 3-financial-year trading record; AND

Demonstrate ownership continuity and control for at least the most recent financial year of the trading record
* Listing applicant under the market capitalization / revenue test (above 2nd one) is not subject to the management and ownership continuity requirement
Maintenance requirements

Minimum market capitalization of:
US$24m (HK$200m)

Minimum public float:
15% - for market capitalization between US$513m (HK$4bn) and US$1.3bn (HK$10bn)
25% or US$12.8m (HK$50m), whichever higher - for market capitalization below US$513m (HK$4bn)

Minimum number of shareholders:
300; 1,000 – for applicant under market capitalization / revenue test (above 2nd one)
36
Hans Kim
Hong Kong listing (Main Board) – pros and cons
Cons
Pros
High listing cost
Geographical proximity, common language and common culture

Traditional fund raising platform for China

Since Qingdao Brewery listed in Hong Kong tock Exchange in 1993, Hong
Kong Stock Market has become the most important offshore listing
platform for Chinese companies. There are now over 170 Chinese
companies (H share and red chip) listed in Hong Kong

Chinese companies are now a major part of the Hong Kong Main board. In
2005, Chinese companies contributed 30% of market capitalization and
40% of market turnover respectively

Experience and market size attracts good broker coverage. Concentration
of institutional investors and fund houses also ease fund raising

The average IPO cost (ex-commission) is about US$1.2m (HK$10m). It is
expensive relative to other stock exchange, such as US$750,000 for Singapore
Stock Exchange and US$450,000 for AIM
Buying exiting listed company is another way of listing. Average “shell” price is
approximately US$6m (HK$50m), which is also expensive relative to other
markets
Relatively high entry barrier

Listing on the Main Board requires fulfillment of certain financial thresholds not
required in other stock listings
Relatively long listing procedures
Good liquidity and strong post IPO fund raising capability

Market liquidity makes secondary listings possible and reduces the need
for dual listings

In 2004, turnover / market capitalization ratio was 77%, compared with 7%
for AIM and 9% for SESDAQ (Singapore Stock Exchange)

Between 2001 and 2005, over 54% of fund raised by red chips was from
secondary offerings
37

In light of the recent corporate scandals, Hong Kong Stock Exchange has
toughened the approval process for IPOs

Listing procedures now takes about 6-9 months to complete, compared to 3-6
months for AIM
Hans Kim
Hong Kong listing (GEM) – listing requirements
Length of business operation

Candidate must fulfill either period of active business operations:

No minimum financial requirement

Revenue:
Not less than US$64m (HK$500m) in the last 12 months; OR

Assets:
Not Less than US$64m (HK$500m) in the last financial period; OR

Market cap: Not less than US$64m (HK$500m) with not less than US$19m (HK$150m) held by the public
24 months
12 months

Exemptions may be granted for mining companies and newly formed project companies, such as major infrastructure projects, which can have shorter
trade records
Ownership and management continuity

Must be under substantially the same management and ownership over the period of active business operations
Maintenance requirements

Minimum of market capitalization:
US$5.9m

Minimum public float:
20% or US$128m (HK$1bn), whichever higher - for market capitalization exceeding US$513m (HK$4bn)
25% or US$3.8m (HK$30m), whichever higher - for market capitalization less than US$513m (HK$4bn)

Minimum number of shareholders
300 – for market capitalization exceeding US$513m (HK$4bn)
100 – for market capitalization less than US$513m (HK$4bn)

Financial reporting
Quarterly
38
Hans Kim
Hong Kong listing (GEM) – pros and cons
Cons
Pros
High listing cost
Geographical proximity, common language and culture
Relatively low entry barrier


Similar to Hong Kong Main Board, listing expense is relatively expensive,
approximately US$1.2m in total

As market capitalization of GEM listed companies are relatively small, listing
cost can comprise up to 20% of total fund raised
GEM does not have specific financial requirement for listing candidates;
the same is true for other growth markets such as AIM and SESDAQ
Poor liquidity
Stepping stone to Hong Kong Main Board

Good GEM listed companies usually swap to Main Board after
accumulating 3-year profit record post GEM listing

The first, second and sixth largest GEM listed companies swapped to the
Main Board. Altogether there are over 10 GEM listed companies that have
swapped to the Main Board

Liquidity of GEM is very poor, and deteriorating. Turnover / market
capitalization ratio dropped from 6% in 2002 to 3% in 2004 compared to 7% for
AIM and 9% for SESDAQ

Poor liquidity results in difficulty of post IPO fund raising. Since 1999, post IPO
only raised US$129m for Chinese companies
Relatively long listing procedures
39

In light of the recent corporate scandals, Hong Kong Stock Exchange has
toughened the approval process for IPOs

Listing procedures now takes about 6-9 months to complete, compared to 3-6
months for AIM
Hans Kim
3
Other listing options
40
Hans Kim
Singapore listing – listing requirements
Financial capability

Candidate must fulfill one of the three tests in order to satisfy the financial attributes requirement:
Profit test (1)
Profit test (2)
Market
capitalization test

Profit:
Cumulative pre-tax profit of at least US$4.5m (S$7.5m) for the last 3 years; AND

Profit:
Pre-tax profit not less than US$0.6m (S$1m) in each of these 3 years

Profit:
Cumulative pre-tax profit of at least US$6m (S$10m) for the latest 1 or 2 years

Market cap: At least US$48m (S$80m) at the time of the IPO, based on the issue price and post invitation issued
share price
Trading moratorium

Promoters’ entire shareholding at the point of listing for first 6 months after listing (above 1st and 2nd options)

Promoters’ entire shareholding at point of listing for first 6 months after listing; and at least 50% for the next 6 moths (above 3rd option)
Other listing requirements

Minimum public float:
12% - for market capitalization larger than US$595m (S$1bn)
15% - for market capitalization between US$238m (S$400m) and US$595m (S1bn0
20% - for market capitalization between US$178m ($S300m) and 238m (S$400m)
25% - for market capitalization less than US$178m (S$300m)

Minimum number of shareholders:
1,000 - primary listing
2,000 - secondary listing

Financial position
No shortfall in working capital
All debts owing by directors, substantial shareholders and companies controlled by directors and
substantial shareholders must be settled
41
Hans Kim
Singapore listing – pros and cons
Cons
Pros
Deteriorating market reputation
Geographical proximity, common language and culture

While Hong Kong and NASDAQ have increased scrutiny of IPOs following
corporate scandals, Singapore has become more lax to attract Chinese
companies leading to increased corporate scandals and loss of market
confidence

A notorious example is China Aviation Oil, which went bankrupt due to crude
oil future speculation. It was once held up by SESDEQ as a model of
corporate governance.

The loss of reputation has directly impacted the liquidity of the market. Its
liquidity is only about one-fifth of the Hong Kong Main Board
Relatively low entry barrier compared with HK Main Board


Singapore requires lower profit or market capitalization for listing
Popular with companies that don’t want to list on growth markets like AIM
or GEM, but are barred from Hong Kong Main Board due to its high
financial requirements
Ease of secondary offering procedures

Secondary offerings are usually completed in 2-4 weeks
42
Hans Kim
NASDAQ Listing – listing requirements
Financial capability

Candidate must fulfill one of the three tests in order to satisfy the financial attributes requirement:
Marketplace Rule
4420(a)
Marketplace Rule
4420(b)
Marketplace Rule
4420(c)

Market cap: At least US$8m for public shares; AND

Equity:
At least US$15m; AND

Profit:
At least US$1m pre-tax income

Market cap: At least US$18m for public shares; AND

Equity:

Market cap: At least US$20m for public shares; AND

Assets:
At least US$75m; OR

Revenue:
At least US$75m; OR

Market cap: At least US$75m
At least US$30m
Alternative – NASDAQ Small
Cap Market

Market cap: At least US$5m for public share;
AND

Equity:

Market cap: At least US$50m; OR

Profit:
At least US$5m; OR
At least US$750,000 from
continuing operations, in last
fiscal year or 2 of the last 3 fiscal
years
Ownership and management continuity

2 years operating history is required for listing by fulfilling Marketplace Rule 4420(b)

1 year operating history is required for listing on the NASDAQ Small Cap Market. It can be waived if the market cap is greater than US$50m
Maintenance requirements

Continuing listing requirements:
Equity > US$10m + publicly held share value > US$5m + min US1 share price;
OR
Market cap/assets/revenue > US$50m + publicly held share value > US15m + min US$1 share price

Market maker:
3 market makers are required
Marketplace Rule 4420(c): 4 market makers are required

Minimum number of shareholders:
400 each holding 100 or more shares
NASDAQ Small Cap Market: 300 each holding 100 or more share

Sarbanes-Oxley Act:
Substantial requirements
43 for corporate governance
Hans Kim
NASDAQ Listing – pros and cons
Cons
Pros
Heavy compliance cost
The largest growth market with good liquidity

NASDAQ is the largest growth market in the world. Its capitalization
reached US$3,153bn in 2004, which is 70x AIM and 346x GEM

In 2004, monthly turnover / market capitalization ratio was 24%, compared
to 7% for AIM and 9% for SESDAQ

These market characteristics favor large scale fund-raising
Of the 23 Chinese listed NASDAQ companies, many are tech-concept
stocks, including: Baidu, Netease, Sohu, Sina, Asia Info, UT Starcom,
China.com and Kongzhong.com

While Asian stock markets are less keen on tech concept stocks, NASDAQ
provides a platform and relatively higher PE for these companies
Sarbanes Oxley (SOX) has placed a heavy burden on US listed companies

According to research by AeA, for a company with revenue less than
US$100m, SOX compliance can cost more than 2.5% of revenues
High litigation risk
Friendly to high-tech concept stocks



Out of 23 Chinese listed companies, 7 have been sued

Litigation costs and compensation/fine can pose a severe threat to the
financials of the listing company
Relatively high continuing listing requirement

The continuing listing requirement is clearly far stricter than other growth
markets, especially the minimum market cap and share price

The number of companies listed on NASDAQ have decreased due to strict
continuing listing requirements

From 1995 to 2002 there were 5,143 NASDAQ delistings compared to 1,497
NYSE delistings and 712 AMEX delistings
Long listing procedures

44
Listing on NASDAQ normally takes 1 year to complete, which is more than
twice the time required for AIM listings
Hans Kim
AIM – listing requirements
AIM has neither financial nor operational requirements for listing candidates
Advisors required to list on AIM



NOMAD (Nominated advisor)

NOMAD warrants to the Exchange that the candidate is appropriate for joining AIM

NOMAD has to be retained throughout the company’s life in the market
Broker

A securities house and member of the LSE

It is the broker’s responsibility to gauge the level of interest in the company’s shares and advise on pricing, and place them with investors
Accountant


Corporate lawyer


Review and audit the candidate’s finances
Draw up all agreements surrounding the flotation. They are also responsible for the due diligence process – verifying statements in the prospectus
and other documents
Financial PR company

Responsible for promoting the company, helping creating the analyst presentation, afterwards advising on investor relations strategy
Documents required to list on AIM

Prospectus

Due diligence report

Analyst presentation

10 day announcement – the form is completed by the NOMAD and sent to the AIM, at least 10 clear business days prior to admission of the new company.
AIM then disseminates this over the Regulatory News Services, the LSE’s official news outlet, and checks for any material objection for the listing

Declaration by NOMAD

Application form signed by the company
45
Hans Kim
AIM – pros and cons
AIM is a new market for Chinese companies with the first listing in October 2004, but is rising in popularity
Cons
Pros
Geographical disadvantage
Very low entry barrier
AIM has no financial or operational requirements for listing

London is geographically far from China.
popularity of shares
Simple listing procedures and short listing process

NOMAD are mostly western corporate finance companies. Language and
cultural differences may lead to difficulty, and result in the need for additional
advisors


LSE relies on the NOMAD to warrant the listing company, thus simplifying
the listing procedures. Admission documents are only pre-vetted by the
NOMAD

After appointment of the NOMAD, it normally takes only 3-6 months to get
listed on AIM
Lack of popularity in Greater China area
Low listing cost

Culture unfamiliarity may affect
Listing costs on AIM is about US$450,000 (GBP0.25m, ex-listing
commission), compared to (US$1.2m) listing in Hong Kong and
(US$750,000) in Singapore

AIM was set up in 1995, but there are now only 17 Chinese companies listed
there; Chinese listings only started in October 2004

Lack of popularity in China has reduced some of the advantages of being
listed, such as reputation enhancement, however this is improving as AIM
hosts road shows etc to raise its profile
Relatively strong liquidity among growing markets

Monthly turnover / market capitalization ratio for AIM was 7% in 2004,
improving from 3% in 2002. AIM index was up by 20.4% in 2004

It is far more attractive than 3% of GEM and approaching 9% of SESDAQ
Flexible trading

No minimum public shareholdings

In most cases, no prior shareholder approval is required for transactions
46
Hans Kim
Chinese enterprises listed on AIM
Name
Ticker
Sector
Sinosoft Technology
SFT
Software
Bodisen Biotech
BODI
Agricultural Biotech
China Shoto PLC
CHNS
Batteries/Battery Sys
Listing date
Current market cap Listing market cap
Listing method
(GBP in m)
(GBP in m)
06 March 2006
58.8
NA
IPO
06 February 2006
158.9
NA
IPO
06 December 2005
38.0
26.0
IPO
Mandarin Merchant Capital PLC 620534Z Investment Companies
16 September 2005
NA
NA
IPO
EBT Mobile China
EBT
Cellular Telecom
08 September 2005
51.8
26.5
RTO
Asian Citrus Holdings Limited
ACHL
Agricultural Operations
03 August 2005
141.7
68.0
IPO
Jarlway Holdings PLC
JWY
Machinery-Constr&Mining
18 July 2005
3.8
6.0
IPO
South China Resources PLC
SCR
Metal-Diversified
18 April 2005
38.5
4.0
IPO
Sweet China PLC
SWC
Capital Pools
31 March 2005
NA
NA
RTO
Central China Goldfields PLC
GGG
Gold Mining
30 March 2005
12.5
NA
RTO
Ming Resources PLC
MTA
Investment Companies
29 March 2005
2.3
NA
RTO
SovGEM Limited
SOV
Investment Companies
23 November 2004
4.3
11.4
IPO
China Wonder Limited
CWO
Diversified Operations
01 October 2004
3.8
2.5
IPO
GruppeM Investments PLC
GRP
Investment Companies
18 February 2004
NA
NA
RTO
Hemisphere Properties PLC
HPE
Real Estate Oper/Develop
05 August 2003
0.8
2.5
RTO
CYC Holdings PLC
CYC
Investment Companies
08 April 2003
2.8
NA
RTO
Churchill China
CHN
Consumer Products-Misc
26 October 1994
NA
NA
IPO
Source: Bloomberg, BDA research
Data as of 10h May 2006
47
Hans Kim
Key Advantage of LSE AIM
- Normally 3 year trading record required
- No trading record requirement
- Minimum 25% shares in public hands
- No minimum market cap.
- Prior shareholder approval required for
substantial acquisitions and disposals
- No minimum shares to be in public hands
- No prior shareholder approval for transactions
- Minimum market capitalization
48
-
Nominated adviser required at all times
-
SME Business 에 적합
Hans Kim
Key Advantage of LSE AIM
NASDAQ에 비해 상대적으로 등록 Regulation이 중소기업에 유리한 조건을 가지고 있어,
상장조건이 수월하며 매년 상장되는 기업의 수가 많다. (UK외 International기업의 상장기회가 많다.)
-KOSDAQ이나
- 등록 및 유지 비용이 NASDAQ보다 훨씬 저렴하고, KOSDAQ보다는 다소 비싸다.
- Pound화의 변동추이가 원화보다 작다.
- KOSDAQ에 비해 PER가 높다. -> 회사가치 대비 보다 정확하고 효율적인 Valuation 이 가능하다.
- Open-end Fund Raising이 활발하고, 1차보다 2차의 Raising 규모가 크다. -> 회사의 지속적인 성장이
가능하다.
- 유럽에서 기업의 Name Value가 높아져 시장 진출이 용이하다.
- Market에서 지정한 전문적인 Underwriter들 (Nomad) 이 있다. 어드미션이나 IPO후, 회사의 가치를
부양해주며, 경영에 도움을 줄 수 있다.
- IPO시 대주주의 지분이 Dilution 되는 정도를 조절할 수 있다. : 보통 코스닥 상장시 대주주 지분이
40%정도 Dilution되는 것이 일반적이지만, AIM은 5%정도로 조절하는것이 가능하며, Equity뿐 아니라 싼
이자의 Debt로도 Funding을 받을 수 있다.
- M&A고려시 코스닥보다 AIM에 상장되어 있는것이 여러측면에서 유리하다.
- AIM시장은 기관투자가들이 메인이 되는 시장으로, Fluctuation이 심하지 않고, 지속적으로 꾸준한 성장이
가능하다.
49
Hans Kim
KOSDAQ & AIM – 상장조건 비교
구분
Kosdaq (벤처기업 기준)
AIM
자기자본
15억원이상
규정 없음
자기자본이익률 (ROE)
* 5% or 순이익 10억이상
규정 없음
소액주주500인 이상,
주식의 분산요건
규정 없음
발생주식총수의 30% 이상
소유주 비율 변동
청구일전 1년 이내 변동 없어야 함
규정 없음
심사자
Kosdaq 위원회
Nominated Advisor
등록 주관주체
증권회사
Nominated Advisor & Broker
50
Hans Kim
AIM, NASDAQ, KOSDAQ – 상장및 유지 비용
등록비
증권거래소
수수료
LS E A IM
N ASD AQ
KO SD AQ
N om ad/회계/법률등 비용
등록 유지비
$8,000
연간 수수료
IP O 시 B ro ker 비용
주식거래비용
기타
공모규모의
3% ~ 6%
거래세: 0.5%
수수료:$7~ $100
+ 소득세
40M share기준
공모규모의
~ 7%
수수료:
$6~ $15/trade
+ 소득세
자문비용
추정치사용
(S arbanes-O xley 법
고려)
공모규모의
2.5% ~ 4%
거래세: 0.3%
수수료: 0.05~ 0.2%
40M share기준
$8,000
$900,000 N om ad/회계등 연간비용
$145,000
총계
$908,000
총계
$153,000
수수료
$125,000
연간 수수료
$34,500
회계/법률등 비용
$2,000,000
회계/법률등 연간비용
$1,000,000
총계
$2,125,000
총계
$1,034,500
수수료
$10,000
연간 수수료
$500
회계/법률등 비용
$100,000
회계/법률등 연간비용
$50,000
총계
$110,000
총계
$50,500
51
Hans Kim
Market 비교
2005 년 기준
증권거래소
등록 기업수
(누적)
M arket C ap
(누적)
거래규모
Total IP O 금액
S econd R aising
A ve. Fund R aising
신규등록기업수
LS E A IM
1399 (1179/220)
$113B
$84B
$13B
$5B
$34.7M
519 (399/120)
N ASD AQ
3164
$3603B
$10000B
$12.2B
NA
$87.8M
139
KO SD AQ
918
$70B
$437B
$3.7B
$2.2B
$53.6M
69
2006 년 10월 25일 기준
증권거래소
등록 기업수
(누적)
M arket C ap
(누적)
거래규모
Total IP O 금액
S econd R aising
A ve. Fund R aising
신규등록기업수
LS E A IM
1590 (1307/208)
$150B
$88B
$12.6B
$8B
$62.4M
330 (244/86)
N ASD AQ
3206
$3,670
$8777B
42
KO SD AQ
954
$68B
$351B
37
52
Hans Kim
AIM _ New Touch Guideline for AIM Nomads_Feb 19, 2007
From
The Times
February
LSE
The
wording of a key declaration to be published on the
front page of admission documents, assigning to nomads
the responsibility for the “appropriateness” of AIM
applicants, is expected to be tempered.
19, 2007
draws up new tough guideline for AIM nomads
The
London Stock Exchange is expected to publish strict guide-lines
this week for advisers bringing companies to AIM, the junior London
market.
Baty, a nominated adviser and assistant director
of corporate finance at Hanson Westhouse, said: “We don’t
expect the new rules to be too prescriptive. The whole point
of AIM is that it is regulated by the nomads. The spirit of the
rulebook is that the nomad uses their judgment.”
In
Although
Elizabeth
Richard
Colman
an attempt to make the industry more accountable, the first tangible
rulebook for nominated advisers, or nomads, will demand that more
thorough due diligence be carried out on AIM applicants.
AIM applicants are required at present to show
legal and accounting diligence, the rulebook will require
nomads to prove to AIM regulators a knowledge of the
company and its directors. This will present a particular
challenge in emerging markets such as China and India,
and the crackdown is expected to provide a boon to
business intelligence services.
Proposed
rules include the demand for strict background checks on all
directors and site visits to the headquarters of nonUK companies.
Failure to comply with the rules could lead to a nomad being banned
from AIM. The crackdown follows a string of profit warnings involving
AIM-listed companies and criticism from the US about so-called lax
standards.
Russ
Corn, a consultant at Diligence, an intelligence
gathering and risk management firm, has noticed an
increase in business. He said: “There is a feeling among
the nomads and the brokers that they will be required to
look at every single director that they’re bringing to market
and that they validate and check the directors’ declarations
and the essential information that they’re given. Up until
now the nomad could get away with taking it at face value.
Now they’re going to have to do reputation and integrity
profiling.”
Under
the present AIM structure, nomads are not subject to hard-andfast rules. “This is an attempt to show the world that the AIM is taking a
tougher approach,” one nomad said.
However,
many larger nomads said they already complied with the
“best practice” standard set out in the rulebook. The rules are expected
to weed out smaller nomads which “rubber-stamp” applicants’
admission documents and neglect to stay in touch with the company
after listing.
Several
nomads welcome the rules, saying they will
provide an impetus to tell clients that they must do
background checks, in circumstances where it may have
caused offence. Previously, many nomads carried out such
checks without the applicants’ knowledge.
53
Hans Kim
4
Private placement
54
Hans Kim
Private placement – overview
Overview

Private placement is a broad term that refers to any type of equity investment in an asset in which
the equity is not freely tradable on a public stock market

There are two types of private placement investors; financial and strategic

Financial investors, including venture capital, are an important source of funding, especially
for younger companies that do not have access to the public financial markets

Strategic investors provide management and technology know-how and capital
Private placement
Financial investors (private equity)
Who they are
Strategic investors (strategic stake)

Venture capital

Strategic partners (foreign or domestic)

Buyout funds


Funds of funds, etc.
Upstream, downstream or otherwise related
companies

Companies looking to diversify

Gain access to new markets

Ensure steady supply or off-take or other
benefits from equity ownership

Diversify earnings, participate in other
industries

Good financial returns on their equity
investment and typically exit around 5 years
What they want
55
Hans Kim
Financial investors – overview
Sources of private equity (by number of funds)
Fund o f Fund
9.5%
Others
5.3%
M ezzanine
6.4%
Three stages of private equity

Seed/initial stage: Investors investing in companies during this stage are investing in
an idea. A company at this stage usually has a concept or a prototype or has just
started operating, but operating practices and company structure have not been
determined. Investing in companies at this stage is relatively risky and is usually
funded by venture capital. Typical investment amount range from US$1m to US$5m.

Growth stage: A company in this stage has usually operated for a period of time, has
a basic sales team, production capabilities and has in place a basic company
structure. A company in this stage needs capital to expand operations and grow
market share. Typical investment amount range from US$5m to US$40m

Mature/mezzanine stage: A company in this phase is mature and is getting ready for
a public offering in 9-12 months time. Finding a strong and reputable private equity
investor in this stage will add credibility to the public offering. Investment at this range
widely, anywhere from US$40m to US$300m

Buyout – LBO/MBO: There are many different circumstances or events that may
facilitate the initiation of a management buyout (MBO), a form of leveraged buyout
(LBO), including: divestitures of corporate divisions, public-to-private transactions,
SOE restructurings, and other means of transferring ownership of a company. MBO
transactions usually rely on debt instruments to finance a significant portion of the
purchase price, consequently, the majority of these types of deals occur in stable,
mature companies that have an established track record of generating strong and
sustainable cash flows.

These categories are not absolute, but are a useful guide in helping to target the
appropriate kind of investor
Venture Capital
37.3%
Seco ndary market
5.1%
B uyo ut
36.4%
Source: Almeida Capital, BDA
Sources of private equity (by amount)
Others
Fund o f Fund 5.2%
6.8%
M ezzanine
6.5%
Seco ndary market
4.5%
B uyo ut
44.7%
Venture Capital
32.4%
Source: Almeida Capital, BDA
56
Hans Kim
Private equity – pros and cons
Management should carefully review all its options and considerations before committing to raising capital
through private placement
Cons
Pros
Financial
Investors
Strategic
Investors

“Smart money”: Private equity can often bring better
management practices and connections within the
industry to improve the business

Lots of new PE funds looking at China

Flexible fundraising channel: compared to a public
offering, the private placement process is less time
consuming and more flexible. It also avoids the
registration, regulation and control process and
offers more confidentiality against competitors
Financial investors will typically want to exit their
investment in 3-5 years


The public market will often give a more generous
valuation than a private placement investor

Loss of control: Contract stipulations, board member
requirements, and other issues that arise out of the
investment process could lead to loss of control by
management

Eliminates marketing and road show costs

Private placement is more accessible than the
public markets with a higher likelihood of success

Unlike a listed company, shares
employees can’t be freely traded

Legitimacy: Investment by a reputable private
equity fund or company can often provide
encouragement to would-be future investors as it
implies that the company’s financials and its
business model have passed rigorous evaluation
by highly qualified people. It can also raise the
profile of a company waiting to list publicly and
increase its valuation and enhance its performance
in the secondary markets

It is harder for a private company to use un-issued
shares in an acquisition given the unconfirmed value
of the shares

Strategic partners can use capital support to solidify
the business partnership


Strategic investors can bring technology, market
access and best business practices to the Company
Working with another company will require careful
relationship management to align expectations and
have a fruitful relationship
57
owned
by
Hans Kim
IPO
End of Week 3
58
Hans Kim