IPO due diligence procedures or the IPO readiness assessment process is the first step towards making a decision about entering the market. IPO due diligence involves an in-depth examination of a company’s operations to establish whether it meets formal stock exchange requirements and international best practices. Deloitte CIS has already successfully carried out a number of such assessments for IPO projects.
IPO due diligence:
- is carried out when the owners and management of a company are confident that it is likely to undergo IPO in the next three years;
- provides an opportunity for the owners and management of a company to identify issues related to IPO preparation “for the first time” and to review the company’s business strategy;
- allows a company to choose how to present itself to the market, in order to maximize its business value and ensure that procedures are carried out in a timely fashion, thereby reducing its IPO expenditures;
- demonstrates the effect of actual IPO procedures, since eliminating the issues identified upon analyzing a company’s current condition prior to an offering will increase the company’s value and reduce expenditure; and
- is a quick and relatively inexpensive method of conducting risk analysis prior to an IPO, in order to establish priorities and develop a plan to prepare the company for going public.
Typically an IPO Readiness Review will focus on the following areas:
- Strategy and investor story: Have you developed a clear business strategy that you can present to investors in a compelling manner?
- Financial reporting procedures: Are your controls and procedures up to the standard required of a listed company, who and how prepares financial statements?
- Historical financial information: Does your historical financial information conform with the requirements of the stock exchange as appropriate?
- Incentives and remuneration: What impact will the IPO have on existing incentive arrangements, and what changes will need to be made?
- Tax: Do you have tax risks and exposures that need to be addressed before IPO?
- Corporate and tax structure: Are your legal structure trasnparent and understandable for investors? What corporate vehicle will you use for your IPO and where will it be domiciled?
- Corporate governance: What is the impact of Listing Rules for existing corporate governance system?
We prepare a report for our clients based on the results of the IPO due diligence procedures, which provide a complex analysis of the company’s structure and operations, including recommendations for eliminating deficiencies, and an appraisal of the financial conditions and investment appeal, as well as alternative methods of attracting funding. We also provide a dedicated step-by-step plan for listing the company’s shares on a stock exchange, tailor-made to match the company’s needs.
For more information please contact us by email email@example.com or telephone +38 (044) 490 9000.