IPO preparation

Selection of arranger/s

• The IPO advisor will prepare the RfP (tender) to select the IPO arranger(s). The IPO advisor will evaluate not only the price, but also the experience of the arrangers with IPOs on various stock exchanges and, last but not least, a transaction team designated to work on the IPO's arranger's side.

Selection of legal advisers

• As with the selection of the arranger(s), the IPO advisor will prepare the RfP (tender) for legal services with regard to the law firm's experience with the IPO.

Preparation of a presentation to determine the appetite of investors

• During the initial phase of the IPO, it will be helpful to understand the preliminary opinion of investors on the forthcoming IPO (ELM - Early Look Meetings). The IPO arranger(s) will prepare this presentation and will need the full cooperation of the company's management and owners. IPO advisor is ready to participate.

Dataroom preparation

• The preparation of the dataroom is a very demanding activity in terms of drafting, collecting and organizing the document, so that the arranger and legal advisers can do their job well and the preparation for the final stages of the IPO is not endangered. The absence of an IPO advisor often results in full workload for weeks to months for the company's CEO, CFO, COO and his/her team.

Prospectus preparation

• Each IPO prospectus is divided into several chapters / categories, which must contain information about the company that has decided to offer its shares on the public markets. Here you will find historical financial statements, information about the segment where the issuer operates, or issue conditions, for example. Last but not least, the issuer, together with the issuer's legal advisor, works on the issuer's legal, commercial and financial audits. The financial audit is carried out in close cooperation with the issuer's auditor.

Legal and tax aspects

• If you have not underestimated preparation of the ownership structure, then the legal and tax aspects of the issue should be largely covered. Otherwise, these two areas can result in a clear STOP to the entire IPO.

Communication with the issuer's auditors

• Given that the issuer's auditor cooperates on the issuer's financial audits and is, among other things, responsible for the preparation and issuance of the so-called Comfort Letter (a document confirming the financial information provided in the prospectus). The Comfort Letter is a key document without which the arranger(s) will not proceed with the IPO process.

Communication with the central bank

• The national (central) bank in a given country (the CNB in ​​the Czech Republic) is the approver of the prospectus, provides the ISIN number (share issue number) and is the regulator of the capital markets. Communication takes place mainly on the axis of the central bank - legal adviser.

IPO structuring

• One of the main tasks of the arranger(s) is to present the structure of the shares offered. This task includes not only the volume of shares that will be offered to the market, but also a combination of existing and new shares, the size of Greenshoe (option to issue shares) and more.

Approval of the prospectus by the central bank

• As already mentioned, the central bank approves the prospectus. The central bank does not assess the risk factors of the issuer / issue. It only oversees that the issue meets all the conditions for admission to trading on the stock exchange.

Introducing the IPO to stock analysts

• Another round of IPO discussions with third parties. This time with stock analysts, who will inform the issuer of their opinion, especially on the company's valuation / share price. This is one of the most important points of the whole transaction. In the event of a negative response from equity analysts, the IPO plan should be reconsidered or the project suspended. The task of stock analysts is to prepare the so-called Equity Research, which will in future function as a relevant source of opinion for the professional community on the price and possible development of the share price.

ITF (Intention to Float)

• If an ITF is announced, the issuer is publicly declaring his/her intention to go public and offer the company's shares to the investors. Both the management and the owners should be prepared for an increased interest from the media. Information ban is still in place on the details of the issue (esp. expected offering share price)