GETTING THROUGH THE DEAL Initial Public Offerings Initial Public Offerings Public Initial Contributing editors Joshua Ford Bonnie and Kevin P Kennedy 2017 Law Business Research 2017 © Law Business Research 2016 Initial Public Offerings 2017 Contributing editors Joshua Ford Bonnie and Kevin P Kennedy Simpson Thacher & Bartlett LLP Publisher Law The information provided in this publication is Gideon Roberton general and may not apply in a specific situation. [email protected] Business Legal advice should always be sought before taking Research any legal action based on the information provided. Subscriptions This information is not intended to create, nor does Sophie Pallier Published by receipt of it constitute, a lawyer–client relationship. [email protected] Law Business Research Ltd The publishers and authors accept no responsibility 87 Lancaster Road for any acts or omissions contained herein. Although Senior business development managers London, W11 1QQ, UK the information provided is accurate as of July 2016, Alan Lee Tel: +44 20 3708 4199 be advised that this is a developing area. [email protected] Fax: +44 20 7229 6910 Adam Sargent © Law Business Research Ltd 2016 Printed and distributed by [email protected] No photocopying without a CLA licence. Encompass Print Solutions First published 2015 Tel: 0844 2480 112 Dan White Second edition [email protected] ISSN 2059-5484 © Law Business Research 2016 CONTENTS Global overview 5 Japan 51 Joshua Ford Bonnie and Kevin P Kennedy Kohei Koikawa and Masashi Ueda Simpson Thacher & Bartlett LLP Nishimura & Asahi Australia 6 Korea 55 John Williamson-Noble and Tim Gordon Chang Hyeon Ko Gilbert + Tobin Kim & Chang Belgium 11 Luxembourg 59 Arnaud Coibion, Gilles Nejman, Thierry L’Homme, François Warken and Laurent Schummer Filip Lecoutre and Xavier Taton Arendt & Medernach SA Linklaters LLP Mexico 64 Cayman Islands 15 Maurice Berkman Baksht, Guillermo Pérez-Santiago, Rolf Lindsay, Barnaby Gowrie and Andrew Barker José Alejandro Cortés Serrano and María de los Ángeles Walkers Padilla Zubiría Galicia Abogados S China 20 Jeffrey Ding and Toby Li Singapore 69 Fangda Partners Loo Choon Chiaw, Yau Khai Ling and Gerald Cheong Loo & Partners LLP France 23 Olivier Saba and Jean-Damien Boulanger Switzerland 74 Bredin Prat AARPI Philippe A Weber and Christina Del Vecchio Niederer Kraft & Frey Ltd Germany 28 Herbert Harrer and Alexander Schlee Taiwan 83 Linklaters LLP Lihuei (Grace) Mao Lee and Li, Attorneys-at-Law Hong Kong 32 Celia Lam and Christopher Wong Turkey 87 Simpson Thacher & Bartlett LLP Ömer Çollak and Ökkeş Şahan Paksoy Indonesia 37 Pheo M Hutabarat and Rosna Chung United Kingdom 91 Hutabarat, Halim & Rekan Clare Gaskell, Deborah Harris, Lucy Gillett and Rebecca Jack Simpson Thacher & Bartlett LLP Ireland 41 Lee Murphy and Niamh Rouse United States 97 Eversheds Joshua Ford Bonnie and Kevin P Kennedy Simpson Thacher & Bartlett LLP Italy 46 Nicola Brunetti, Emanuela Ciaffi and Maria Diletta Camicia Gattai, Minoli, Agostinelli & Partners 2 Getting the Deal Through – Initial Public Offerings 2017 © Law Business Research 2016 PREFACE Preface Initial Public Offerings 2017 Second edition Getting the Deal Through is delighted to publish the second edition of Initial Public Offerings, which is available in print, as an e-book and online at www.gettingthedealthrough.com. Getting the Deal Through provides international expert analysis in key areas of law, practice and regulation for corporate counsel, cross-border legal practitioners, and company directors and officers. Throughout this edition, and following the unique Getting the Deal Through format, the same key questions are answered by leading practitioners in each of the jurisdictions featured. Our coverage this year includes Belgium, the Cayman Islands, Ireland and Turkey. Getting the Deal Through titles are published annually in print. Please ensure you are referring to the latest edition or to the online version at www.gettingthedealthrough.com. Every effort has been made to cover all matters of concern to readers. However, specific legal advice should always be sought from experienced local advisers. Getting the Deal Through gratefully acknowledges the efforts of all the contributors to this volume, who were chosen for their recognised expertise. We also extend special thanks to the contributing editors, Joshua Ford Bonnie and Kevin P Kennedy of Simpson Thacher & Bartlett LLP, for their continued assistance with this volume. London July 2016 www.gettingthedealthrough.com 3 © Law Business Research 2016 Simpson Thacher & Bartlett LLP GLOBAL OVERVIEW Global overview Joshua Ford Bonnie and Kevin P Kennedy Simpson Thacher & Bartlett LLP According to a study by Ernst & Young LLP, 2015 saw US$195.5 billion in of companies sit in the IPO pipeline. In Japan, the Tokyo Stock Exchange IPO proceeds raised globally in 1,218 transactions, a decrease from 2014 of Main Market hosted 23 IPOs raising an aggregate of more than US$14 25 per cent and 2 per cent, respectively. Even excluding the record-setting billion, including two of the highest grossing IPOs of 2015 – Japan Post US$25 billion IPO of Alibaba Group Holding Ltd in 2014 on the New York Holdings Co, Ltd (US$5.7 billion) and Japan Post Bank Co, Ltd (US$5 bil- Stock Exchange (NYSE), global IPO proceeds were down 17 per cent in lion). The Australian IPO market in 2015 saw more deal volume than 2014 2015 as compared to 2014. but IPO proceeds declined by 71 per cent. In the United States, 2015 was much more measured compared to a Europe had a healthy year in the IPO market, particularly towards banner year in 2014 when US IPO activity was the highest since 2000. the end of 2015. According to Renaissance Capital, Europe came in sec- According to Ernst & Young LLP, 173 companies conducted IPOs on US ond in IPO activity during 2015, representing 35.5 per cent of global IPO exchanges, including 31 non-US companies that raised more than 80 per proceeds. In London, there were 92 IPOs on the London Stock Exchange cent of the aggregate proceeds derived from cross-border IPOs during the (LSE) in 2015 raising a total of approximately £11.9 billion according to year, and the NYSE ranked second in the world in 2015 based on IPO gross PricewaterhouseCoopers, although this was a decline from 138 IPOs rais- proceeds while the NASDAQ ranked first in the world based on number ing a total of £16.9 billion in 2014, which had been a seven-year high. In of transactions. According to Renaissance Capital, IPOs on the NYSE and Amsterdam, 2015 saw the $3.6 billion IPO on the Euronext of ABN Amro. NASDAQ collectively represented more than 17 per cent of global IPO In Germany, 13 German companies and two foreign companies completed activity in 2015, as measured by gross proceeds raised in IPOs with a deal IPOs on the regulated market of the Frankfurt Stock Exchange, marking size of at least US$100 million. the most successful year for IPOs since 2007. In Asia, 117 companies newly listed on the Hong Kong Stock Exchange In Latin America, IPO activity remained muted during 2015, with only in 2015, including 33 IPOs with a deal size of at least US$100 million that one IPO completed in Brazil during the year, for example. A number of raised nearly US$29 billion of gross offering proceeds – more than any countries in the region are, however, implementing regulatory reforms that exchange in the world. On the Chinese mainland, the flow of IPOs fluc- could bolster future new issuances. tuated dramatically during the course of 2015 as the Chinese IPO market The editors are pleased to be associated with some of the finest legal was open for only seven months. In December 2015, the Chinese Securities counsel in each of the countries covered in this volume and hope that you Regulatory Commission lifted suspensions on new listings where hundreds find the chapters relevant and useful. www.gettingthedealthrough.com 5 © Law Business Research 2016 AUSTRALIA Gilbert + Tobin Australia John Williamson-Noble and Tim Gordon Gilbert + Tobin Market overview empowers certain persons to apply to a court to seek orders enforcing the Rules. 1 What is the size of the market for initial public offerings The continuous disclosure regime established under the Listing Rules (IPOs) in your jurisdiction? is a key obligation of companies listed on the ASX. Once listed, a company In 2015, there were 97 IPOs with a total market capitalisation of A$17.6 bil- must notify ASX immediately of any information that a reasonable person lion and more than A$8.6 billion in capital raised. Although the total num- may expect to have a material effect on the price or value of the company’s ber of IPOs increased by 33 per cent compared to 2014, the total market securities (subject to certain limited exemptions). capitalisation decreased by 32 per cent on the previous year. The biggest listing for 2015 was Link Group, backed by Private Equity Partners and 5 Must issuers seek authorisation for a listing? What co-owners ICG and Macquarie. The IPO market is expected to continue information must issuers provide to the listing authority and to perform strongly in 2016 and onwards, with the trend of private equity how is it assessed? backed IPOs likely to continue. A company seeking general admission must satisfy certain criteria before it can be listed on the ASX. This involves: 2 Who are the issuers in the IPO market? Do domestic • satisfying a profits or assets test; companies tend to list at home or overseas? Do overseas • submitting a successful application to ASX for permission for quota- companies list in your market? tion of all securities in the main class of the company’s securities (gen- Issuers are typically domestic entities that are issuing securities for the pur- erally ordinary shares); pose of financing their operations.