安永-企业上市指南：首次公开募股前、中、后的战略考量+Strategic+Considerations+Before+During+and+After+IPO

Contents

Whatisaninitialpublicoffering(IPO)?4

Whyareyougoingpublic?

6

Motivationsforgoingpublic

8

Alternativefinancingstrategies

10

Prosandconsofgoingpublic

12

Criticalsuccessfactors

14

Wherecanyoulistyourcompany?

18

Whencanyougopublic?

21

Whoarethekeyplayers?

23

HowcanyoustructureyourIPO?

26

TheEYIPOvaluejourney

28

IPOreadinessassessment

30

TheEYteam-withyoualltheway

35

Contacts42

Guideto

goingpublic

Strategicconsiderationsbefore,duringandafterIPO

WhatisanIPO?

Aninitialpublicoffering(IPO)isthesaleofacompany’ssharestothepublicandthelistingofsharesonastockexchangeforthefirsttime.Throughtheissuanceofnewsharestothepublicinvestors,itallowsacompanytoraisecapitalinordertobuildandexpanditsbusiness.

Companiesthatarefullypreparedwillbeabletocreatevalueandfully

Companiesthathavecompletedasuccessful

IPOknowtheprocessinvolvesthecomplete

transformationofthepeople,processesand

cultureoftheorganizationfromaprivate

enterprisetoapublicone.Preparationis

critical.SuccessfulIPOcandidatesoftenspendtwoyearsormorebuildingbusinessprocesses

andinfrastructure,recruitingexecutiveand

advisorytalent,gettinginfrontoffinancialandreportingissues,andmasteringtheessential

boardofdirectors’commitmentstogopublic.

Duringthejourneytobecomeapubliccompany,anorganizationmustpreparenotonlyforthe

definingmomentoftheIPOceremony—the

ringingofthebell—butalsoforawholenew

phaseofcorporatelifeaftertheIPOtakesplace.That’swhythosethatoutperformthemarket

treattheIPOasalong-termtransformationalprocess,anIPOjourney.

TheEYteamisakeymemberofyourexternalIPOteam.EYteamshaveworkedwith

businessownersandmanagementteamsof

familybusinesses,scaledupandhigh-growthcompaniesaswellasprivateequity-(PE-)

orventurecapital-(VC-)backedcompanies

consideringtheirstrategicoptionsforfundingforgrowth,includingapubliclisting.

EYteamsaremadeupofprofessionalswith

extensive,provenexperiencewithdomesticand

internationalcapitalmarkets.EYprofessionals

havedeepknowledgeofyourindustry,which

allowsustocreatemultidisciplinaryteamsthatwillsteeryouonward,throughandbeyondyourIPO,

andsupportyourplansforgrowth.

ThisGuidetogoingpublicwillgiveyouaninitial

overviewandchecklistsofthekeyphasesingoingpublicfromaglobalperspective.

ItisbasedonEYinsightsfrommanyIPO

transactions,tohelpyoubeginyourIPOvalue

journey,sothatyouarewellpreparedtotransformyourprivatecompanyintoasuccessfulpublic

companythatcontinuallydeliversvaluetoits

shareholders.Withextensiveexperiencehelping

companiesprepare,growandadapttolifeas

apublicentity,EYteamsarewellpositionedto

takeyouonyourIPOjourney,providingtailored

supportandintegratedservicesbefore,duringandafteryourIPO.

EYIPOleadersinyourregionandtheEYglobalnetworkwillserveyoufromevaluatingstrategicoptionspre-IPOtosettingyouontherightpathtosupportgrowthpost-IPO,whileanticipatingtheexpectationsofdifferentstakeholders—

fromregulators,boardofdirectors,employees,investorsandmedia—alongtheway.

Irrespectiveofyourmarketorregion,EYteams

lookforwardtoexploringwithyouthevarious

strategicoptionsandeachfacetofyourIPOvaluejourney.

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Whyareyougoingpublic?

Situations,casesandmotivations

Forprivatecompaniesseekingtoraisecapitalorprovideexitsfortheirshareholders,anIPOcanbeasuperiorrouteandstrategicoptiontofundinggrowth,andtoaccessdeeppoolsof

capital.Whilechallengingmarketswillcome

andgo,thecompaniesthatarefullypreparedwillbeabletocreatevalueandfullyleverage

theIPOwindowsofopportunitywhenevertheyareopen.

Therearemanysituationswhencompanies

starttoevaluateanIPOasoneoftheir

strategicoptions.Fundingorexitmotivations,growth,internationalizationandchangesin

theindustrylandscapesaresometriggersforstrategicconsiderationsforpursuinganIPO.Dependingonthestakeholder,amixofsituationsandmotivationscanleadtothe

initialIPOconsiderations.

SometypicalIPOcasesTypicalcontextsforcompanies

thatgopublic

Strongcompanygrowth

.High-growthcompanies:Tofund

innovation,growth,acquisitionsandinternationalization

PEorVC:exitpressureandmaturity

.PE-andVC-backedcompanies:Toexitandfurtherfundgrowthofportfoliocompanies

Consolidationtrends

.Familybusiness—thecompany:Toraiseoutsidecapitalandenhancecorporate

governance

IPOofcompetitors

.Familybusiness—theowner:Tounlockvalues,diversifyrisksandsuccession

planning

Firstmoverandinnovator

.Scale-upcompanies:Toattracttalentandincentivizemanagement

Front-runnerandindustrydisruptor

.Conglomerates:Tocarveoutandmaximizevaluesfromdifferentbusinesses

.State-ownedentities:Toaccesscapital

marketandenhancecorporategovernance

Nextgenerationorsuccessor

Newopennessandpublicawareness

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MotivationsforgoingpublicMotivationsforgoingpublic

“

Thebestreasontogo

publicisn’ttoexit.Itisn’ttogetthe“going-public”experience.It’sbecauseit’stherightnextstepinthepathonwhichyou’reguidingyourcompany.

Cofounderofa

pharmaceuticalcompany

Formanycompaniesthat

havejuststartedtoconsidergoingpublic,thekey

questionis:CouldanIPObetherightnextstep?

Thepreparationstartswiththecarefulevaluationof

theprosandconsofan

IPO,thepotentialuseof

proceedsandexaminationofalternatives.Thisisin

linewiththefirstquestionsfrominvestorsatanIPO

roadshow:Whyareyougoingpublicandwhat

willtheIPOproceedsbe

usedfor?Answeringthese

fundamentalquestionsis

keytothesuccessofanIPO.

Asuccessfullistingcanhelpyourcompanyunlockaccesstofinancingtocomplete

astrategicacquisition,

createopportunitiesto

expandyourbusinessinto

newmarketsorprovidean

exitopportunityforyour

PEorotherinvestors.In

addition,itcanalsoimproveperceptionsofyourbusinessandbrandwithcustomers,

suppliersandemployees.

Whilenotallbusinessesaresuitedforlifeinthepublic

eye,formanyfast-growingprivatecompanies,anIPOcanraisethecapitalneededtoaccelerategrowthand

achievemarketleadership.

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DoyouhaveanalternativefinancingstrategytoexecuteinsteadofanIPO?

Itisdifficulttoguaranteethatequitymarket

conditionswillberightoncethepreparation

iscomplete.Tohelpensurethattheright

optionisavailableatthecrucialmoment,morecompaniesaretakingadual-ormultitrack

approachwheretheypursueatradesale

orotherfundingsource,andpreparefora

possibleIPOatthesametime.Themultitrackapproachallowsyoutokeepyouroptionsopenduringthepreparationprocess,incasethe

IPOwindowclosesduringthisoftenlengthyprocess.Thus,successfulcompanieshave

aPlanBandoftenaPlanC(forexample,

simultaneouslypursuinganIPO,atradesale,specialpurposeacquisitioncompany(SPAC)mergerordebtrefinancing).

Ifthecapitalmarketsarevolatilewithfalling

valuations(IPOwindowsclosing)andyoucanaffordtowait,youmayelecttoholdoffuntil

themarketconditionsimprove.Itisimperativethatyouhavetheflexibilitytoexecute

alternatefinancingstrategies,incasetheIPOdoesnothappenorneedstobedelayed.Inthemeantime,iffundsraisedfromothersources

canbeusedtoincreasethecompany’sgrowthpotential,thevalueofthecompanymayrise.

Choiceofoptions,financialinstrumentsandmultitrack

Private:

BanksandM&Amarket

Bankfinance

Other

Debt

Public:

Capitalmarket

Bond

Mezzanine

Derivatives

Other

Debt

TraditionalIPO

Carve-outIPO

ReverseIPO

Directlisting

SPACmerger

Other

Equities

Strategicbuyer

PEandVC

Familyoffice

Other

Equities

Single-,dual-ormultitrack

strategies

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Prosandconsofgoingpublic

Outperformingcompaniesweighthebenefitsofgoingpublicagainstthedrawbacks,aswellasagainstthe

company’sandshareholders’objectives.

Pros

.Efficientaccesstocapitalmarketstoraisemoneythroughequityandbondofferingswithbetterfuturefinancingopportunities

.Flexibilitytotradeshareswithhighliquidityanddailyvaluation

.SharesfunctioningasnewliquidM&Acurrency

.Greaterattention,betterbrandrecognitionandprestigewithcustomersandsuppliers

.Abilitytobenchmarkoperationsagainstotherpubliccompanieswithinthesameindustry

.Potentialtodiversifywealthonshareholderside

.Enhancedabilitytoattract,retainand

rewardvaluedemployeesaslistedcompany

.Opportunitytobondandincentivizekeypeoplewithlong-termincentiveplans

Cons

.Holdingalowerstakeinthecompany

.Distractionfrommanagementofbusiness

.Morerequirementsontransparencyanddisclosure

.Thedemandsofperiodicreporting

.InitialIPOexpensesandrecurringcoststomaintainthelistingstatus

.Newinvestorswithvotingrights

.Pressuretodeliveronyourpromisesandtheburdenofdealingwithshareholders’expectations

.Highercorporategovernancestandardrequirements

.Increasedandongoingregulatoryscrutinyandsupervision

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SuccessfactorsingettingIPOreadyPrepareearly

WehavefoundthatcompanieswithsuccessfulIPOs:

.ApproachtheIPOasatransformationalprocessratherthanjustafinancing

event.BeginwithaholisticIPOreadinessassessmentasafirststep,ideallyovera12-24monthtimeline.

.BegintheIPOreadinessprocessearly

enoughsothatyourpre-listedcompanyactsandoperateslikeapubliccompanyatleastayearbeforetheIPO.

.Assembletherightteamofexternal

advisors,andcommitsubstantialinternal

resourcestotheIPOteamandprocess.

Buildaqualitymanagementteam,anda

robustfinancialandbusinessinfrastructure,corporategovernanceandinvestorrelations(IR)strategythatwillattracttheright

investors.

.Buildarobustanddisciplinedapproach

toevaluatethecompanies’non-financialperformance,suchasenvironment,socialandgovernance(ESG).

Evaluatecapital-raising

options

Addressinvestors’concerns

.Startearlywithaholisticdiscussionaboutthestrategicoptionsofferedbythecapitalmarket,andconsideranarrayofexitandfundingalternativesinanIPOreadiness

assessment.

.Consideramultitrackapproachandthe

expandingnumberofcapital-raising

strategies—includingIPO,astrategicsaletoastrategicbuyerorfinancialinvestor(PEorVC).

.PreserveoptionalitywithearlyIPOreadinesspreparationstogetIPOready,toachieve

flexibilityintimingandpricing,andtoprepareformorenarrowIPOwindows.

.Recognizetheneedforenhancedcorporategovernance,recruitingqualifiednon-

executiveboardmembers,improvinginternalcontrolsandformingaqualifiedaudit

committee.

.Fine-tuneyourinternalbusinessoperationsthroughworkingcapitalmanagement,

regulatoryriskandrationalizingthebusinessstructure.

.DemonstrateanembeddedcommitmenttoESGvaluesandculture.

.Developthecapabilitytocomplywithnewfinancialreportingstandardsandsecuritiesregulations.

Outperformcompetitorsonkeybenchmarks

.InvestorsbasetheirIPOinvestmentdecisionsonfinancialfactors,especiallydebttoequityratios,revenues,returnonequity(ROE),

profitabilityandearningsbeforeinterest,taxes,depreciation,andamortization

(EBITDA).

.Investorsbaseanaverageof40%of

theirIPOinvestmentdecisionsonnon-

financialfactors,includingthequality

ofmanagement,corporatestrategyand

execution,brandstrengthandoperationalefficiency,andcorporategovernance.

.Focusonprofitabilityandcashflowsor

articulateaclearpathtoprofitability,

andacompellingequitystorybackedby

astrongtrackrecordofgrowththatsets

yourcompanyapartfromyourpeerswhilemaximizingvalueforowners.

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WhatarethecriticalIPOsuccessfactorsforinstitutionalinvestors?

InvestorswilldecidewhethertheybuysharesofyourIPOornot.ThisiswhyEYteamsrecommendthatyouview

yourIPOfromaninstitutionalinvestor’sperspective.

Institutionalinvestorsdrivestockprices,andinclude

mutualfunds,hedge

funds,banks,insurance

companies,pensionfunds,largercorporateissuers

andothercorporatefinanceintermediaries.

Basedonourexperience,themostimportantIPOsuccessfactorstoinvestorsare:

.Strongmanagementteam

.Compellingequitystory

.Fairvaluation

.Goodcorporategovernance

.Be“IPOready”tomeetcapitalmarketrequirementsandinvestorexpectations

.ESG-embeddedbusinessstrategy

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Wherecanyoulistyourcompany?

TheEYIPOdestinationassessment:findingtherightmarket

Haveyouchosentherightstockexchangeandlistingoption?

Selectingtherightcapitalmarket,stockexchangeandlistingsegmentenablesyoutobetter

determinetheregulatoryrequirementsthatyourcompanywillhavetomeet.Intherun-upto

goingpublic,yourcompany’sinternalstructureshavetobecheckedandpreparedfortherelevantrequirements.Thesemeasuresareessentialtomaintaintheprofileofalistedcompany,andmeettheexpectationsofinvestorsandregulators.

TheEYGlobalIPOtrendsreportshowsthatonalong-termaverage,morethan90%oftheissuerslistontheirdomesticstockexchanges,althoughtheymaymarketandsellsharestooverseas

investorsaspartoftheirglobalsharesaleoffering.

Whereshouldyoulist?Capitalmarketvenue,stockexchangeandlistingsegment—what’sthebestoption?

Companiescanchoosefrommorethana

hundredstockexchangesandlistingoptions

worldwide.Besideslistinginyourhomemarket,therearethreeself-containedregionalvenuesforcompanieswishingtogopublicoutsideof

yourhomemarket,namely,inAmericas,Asia-PacificandEMEIA.Eachvenueis

distinguishedbyitstimezones,culture,currenciesandeconomies.

Questionstoconsiderare:Doesitmakesensetogopublicandhaveyourprimarylistingin

yourcompany’scountryofincorporationand

principaloperations?Orshouldyoulookfurtherafield?Findingtheanswerstothesequestions

canposecomplexchallenges—particularly

iftherearestrategicbenefitstolistingyour

companyawayfromitsfamiliarnationalmarket.Forexample,youcanexpectalistingabroadtoattractconsumers’attentiontoyourcompany’sproductsandincreasemediaexposure.This

canfacilitateaccesstonewmarketsandbenefityourbusinessoperations.Oranoverseasstockmarketandinvestorpoolwillgivethecompanyahighervaluation.

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TheEYIPOdestinationassessmentprovides

guidanceinthefactorsthatrequirecareful

examination.Itsupportsastructuredwayto

assessthesefactors,presentedfromdifferent

IPOstakeholderperspectives.Argumentswhy

tolistabroadcanbecategorizedintofourmajorareas:

.Businessandgo-to-marketstrategies

.Valuationsandinvestorappetite

.Regulatorycomplianceenvironment

.Initialandongoingcosts

Whencanyougopublic?

Navigatingthewindowofopportunity

HaveyouthoughtabouttherightIPOtiming?

TimingthemarketisoneofthekeysuccessfactorsforanIPO.Whentimedcorrectly,itwillbeawin-winsituationforthecompanybyprovidinganoptimalvaluationandIPOproceeds,inadditiontopost-IPOshare

investmentreturnsfortheIPOinvestors.

Companiespreparingtogopublicshould

consider:thestrengthandbuoyancyofthe

capitalmarkets,currenteconomicindicatorsandthecompany’sperformance.Evenin

achallengingeconomy,companiesthat

outperformtheoverallmarketprepareearlyfortheirtransformationalIPOjourney,sothat

theyarereadytolaunchquicklyandmorestrategicallywhenIPOwindowsareopen.

Tocaptureopportunities,companiesmust

communicaterealistictimelineexpectations

totheentireIPOteam—management,board

members,externaladvisorsandothers.

Outperformingcompanieshaveateamand

workingplansinplace,toexplorealternative

exitstrategiestoanIPO,especiallyinuncertainmarkets,althoughIPOsaregenerallyseenas

providingbetteraccesstocapital,visibilityandcredibility.

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Whenisthebesttimetolist?

ThewindowofIPOopportunitycanbedifficulttopredict,

asexternalshocksandmarketdisruptionscomesuddenly

withoutanyannouncementorwarning.Globalizedand

interlinkedcapitalmarketsreacttomanyunforeseen

internationalevents.Forthisandotherreasons,thereis

aneedforstrategyanddiligencepriortogoingpublic.

Determiningthebesttransactiontime(andplace)takes

teamworkandcommitment,andcompaniesthatevaluatethisbasedonquantitativeandqualitativeconsiderationshavea

competitiveadvantage.

Quantitativeconsiderationswillincludecompanyvaluation,stockexchangeandmarketvolatilityindices,whilethe

qualitativefactorscanbetheglobalorregionalgeopoliticallandscape,marketexpectationsongovernmentpoliciesandinvestors’sentiment.

Otherconsiderationsyouwillneedtoexamineincludethe

specificmarketsyouoperatein,howcomparablecompaniesaredoingandwhetherinvestorsarereceptivetonew

issuanceinyoursector.

Whoarethekeyplayers?

Onyourjourneytobecomeapubliccompany,yoursuccessdependsagreatdealonthecoordinatedteameffortbytheinternalmanagementandtheexternal

advisoryteam.

Isyourmanagementteamexperienced,anddotheyhaveanIPOtrackrecord?

Buildingapowerfulteamstartsatthetop.

Theinvestmentcommunitywilllooktothe

CEOtoarticulateandexecutethecompany’svisionandbusinessstrategy,whiletheCFO

willlikelybefocusedoninvestorrelationsinapubliccompany.IdeallythecompanyshouldincludeexecutiveswhohavepubliccompanymanagementorIPOexperience.

AnotherleadingpracticeofIPOcompaniesistoinstillprojectmanagementintotheIPOreadinessprocess.Theyoftenformalizea

projectmanagementoffice(PMO)thatis

responsiblefororganizing,planningand

monitoringtheIPOprocessandtimeline,

therebymitigatingrisksandincreasingthe

likelihoodofasuccessfuloutcome.TheIPOPMOcanalsoensurethemanagementisnotundulydistractedandcanremainfocusedonmanagingthecompany’sbusinessoperations,whilethe

IPOpreparationworkcontinuesbehindthescene.

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BuildtherightexternalIPOteam(bankers,lawyers,auditors,investorrelationsandotheradvisors)

YourexternaladvisorsshouldbehighlyskilledprofessionalswithextensiveIPOservice

credentials,contactsandindustryexperience.

Itisveryimportanttoselectandbuilda

qualityIPOadvisoryteam.Begintoassemble

youradvisoryteamwellinadvanceofyour

anticipatedpubliclaunch.Professionaland

experiencedadvisorswillbeabletohelpyougetIPO-ready,tocarefullymakenecessarychangestothebusiness,introduceyoutotheright

investors,helpyoutellyourstoryand,most

significantly,putavalueonyourbusinessthat

reflectsitspositionandpotential.GetthisrightandtheIPOwillstillbehardworkbutacohesiveteamcanhelpyieldoptimalresults.

Post-IPO,asapubliccompany,yourprofessionaladvisorscansupportyoutocontinueimprovingonthecompany’sriskmanagementandinternalcontrolsonitsoperations,financialreporting

andcompliance.

Keyinternalandexternalteams

*Suchastax,accounting,internalcontrols,cybersecurity,riskmanagement,ESG

HowcanyoustructureyourIPO?

IPOprocessandtheEYIPOvaluejourney

TheIPOprocessshouldbe

astructuredandmanaged

transformationofthepeople,processesandcultureofanorganization.

AtEY,werefertothisastheIPOvaluejourney,whichembracesthephilosophythattheIPO

eventisnottheendgamebutamomentous

occasionthatwillimpactyourorganizationlongaftertheactualtransaction.Thevaluejourneytypicallybeginsatleast12to24monthsbeforetheIPOandcontinueswellbeyondthat.Thus,

whileanIPOshouldbeakeyturningpointin

thelifeofyourcompany,marketleadersdon’ttreatanIPOassimplyaone-timefinancial

transaction.Rather,theyrecognizetheIPOeventitselfasjustonedefiningmilestoneinacomplextransformationaljourneyfromaprivatetoapubliccompany.

Evenwhenthefinancialclimateisnotideal

forfundraising,itcouldbeagoodtimetobe

planningandpreparingfora