Listing your private company on the Australian Securities Exchange (ASX) can sound more challenging than it actually is.
Just like any other business venture, all you need is the right team, information and strategy in place. Going public can provide your company with access to a broad array of investment opportunities and help your business reach and surpass its potential.
There are over 2,100 companies listed on the ASX, according to the organisation. Each corporation has met the following criteria:
- Secured 300 non-affiliated investors with at least A$2,000 in ownership.
- At least 20 per cent of the shares being offered should be free floating. These do not have to be available before you submit your application.
- One of two: Generate at least A$1 million in profit over the last three years and A$500,000 in the last year (profit test); A$4 million in assets or A$15 million market capitalisation (assets test).
Listing on the Australian Securities Exchange is easy with the right strategy.
One of the responsibilities for public companies includes biannual reporting of financial statements. Yet this is also a benefit of listing, as it encourages better organisation and structure by improving business performance to accommodate this requirement.
Peculiarities and planning ahead
Companies that are already listed on a foreign stock exchange are still able to apply to the ASX through two ways: a regular ASX listing, or an ASX Foreign Exempt listing. The former needs to follow all the aforementioned rules, including financial reporting, while the latter may continue to adhere to the responsibilities required of the other exchange they are public on.
It's important to note that the amount of working capital available is disregarded for businesses that apply through the profit test. The opposite is true of the assets test, and the amount needed is A$1.5 million. Your corporation will also need to conduct audits for the past three years if applying through the profit test, and two years if by the assets test.
Overall the process should take around three months to complete. These are the key stages:
- Week one: Hiring professional business strategy advisers to help guide your through each step.
- Weeks two through 10: Conducting due diligence and drafting prospectus.
- Weeks 10-11: Begin marketing campaign for initial public offering.
- Weeks 11-12: File prospectus with Australian Securities and Investments Commission.
Before beginning your journey as a publicly listed company on the ASX, ensure you surround yourself with experts in the field to avoid any potential mishaps and to get a valuation for your business. Contact an Alpin Advisory representative to learn more.