Secondary Equity Offerings: Structure & Regulation Update

Course Overview

Secondary equity offerings, such as rights issues, placings and open offers, have become increasingly popular in the last few years, as UK listed companies have been strengthening their balance sheets, refinancing bank debt and raising additional finance for corporate development. The challenging market conditions have also meant that the structures for these offerings have evolved, with increased use of deep discount rights issues and cash box placings as well as the emergence of compensatory open offers, cornerstone investors and new underwriting procedures.

This course looks at the way recent secondary equity offerings have been undertaken and regulated and considers the advantages and disadvantages for the issuer of each type of offering.

Course Content

Introduction

• Current market trends

UK regulation for UK equity issues

• Companies Acts and FSMA
• UK pre-emption requirements
• Premium listing, Prospectus and Disclosure and Transparency Rules
• Changes coming in the Prospectus Rules

Structures for UK equity offerings

• Rights issues
  • Traditional and deep discount
  • Rise of fees
  • Rights Issue Fee Inquiry conclusions
  • OFT market study of equity underwriting recommendations
  • Shortened timetables
• Open offers/ placings with clawback and other placings
• Recent structures
  • Compensatory open offers
  • Cash box placings and rights/open offers
  • Other securities
  • Cornerstone investors

Means of marketing shares

• Markets
• Institutional and retail offerings
• International tranches
  • US issues
• Pre-marketing and marketing

Price setting mechanisms

• Fixed price
• Bookbuilding
  • The process
  • Accelerated bookbuilding
  • “Red herring” prospectus
  • Allocation, “Greenshoe” and stabilisation

Legal agreements

• Underwriting agreements
  • Recent issues
• Placing agreements

Which structure to use

• Rights vs. open offer vs. placing
• Fixed price vs. bookbuilding

Delivering this course in-house for you to a number of participants could be very cost effective. Please call us on 020 7387 4484 to discuss this further.

If you have any questions about this seminar please write to us at post@redcliffetraining.co.uk.