In this practical guide, I look at what goes on behind the scenes when investment banks pitch for IPOs to companies and their shareholders.
In clear and simple language, I offer advice and suggestions for the interview, selection and appointment of lead banks across any jurisdiction, as well as for the execution of a flotation – well beyond the mere drafting of a request for proposal (RFP) questionnaire.
Using a wide range of examples and case studies from around the world, I explain negotiation techniques through which listing candidates can save considerable time, effort and costs, and also limit their potential liabilities in their dealings with financial institutions. A variety of sample documents, checklists, an extensive glossary and an index are also included.
This constitutes essential reading for executive and non-executive board members, securities regulators, executives in finance and private equity, auditing and legal professionals, students in finance, financial journalists and anyone with an interest in IPOs and the world’s primary equity markets.
What’s in the Book?
1. The paradigm shift: the negotiating advantage
2. Using an independent adviser or consultant
3. How an adviser/consultant can best add value
4. The beauty parade
5. The invitation email
6. The confidentiality agreement
7. Length of the request for proposal (RFP) and weightings
1. Market Conditions
2. Market positioning
4. Execution considerations and team
5. Marketing considerations
6. Fees and expenses
7. Credentials and other considerations
9. Information on the issuer
1. Interviewing research analysts
2. Drawing up a shortlist
3. Obtaining financing
4. Format of oral presentations
5. Dealing with further marketing efforts
1. How many lead banks?
2. Selecting investment banks
3. Communicating declines
4. Managing leaks
5. The engagement letter(s)
6. Customary principles for placement agreements
7. The kick-off meeting
8. After the kick-off meeting
Appendix 1: Sample invitation email
Appendix 2: Sample score sheets
Appendix 3: Example of RFP questionnaire
Appendix 4: Example of decline email
Appendix 5: Example of request for bank financing
Appendix 6: Example of terms sheet for an IPO
Appendix 7: Example of reminder on confidentiality
Appendix 8: Useful clauses for mandate letters
Appendix 9: International placement agreement principles
Appendix 10: Work allocation among lead banks
Appendix 11: Other parties to be appointed for an IPO
I firmly believe that there are both a right way and a wrong way to go about the process of inviting, selecting, appointing and ultimately working with banks that lead an initial public offering (IPO).
Philippe Espinasse is Mr IPO. There is no greater authority on the Asian new listings market”Jasper MoiseiwitschSouth China Morning Post
…an easy-to-read insider guide, packed with sample correspondence and documents… Good read for new practitioners”Shuli Ren, Emerging Markets ColumnistBarron's
Philippe, an ex-banker, is an expert on Asia’s initial public offering scene, and has incisive thoughts on a dynamic and fast-moving sector that for many banks was the main revenue source for years. He has seen the market shift from being dominated by a few local brokerages, especially in Hong Kong, to one where foreign banks – from Wall Street and European banks held sway, to the increasing role of Chinese players in the market. Philippe’s book with real-life examples on the behind-the-scenes IPO process will be a useful guide for banks and companies navigating one of the world’s most dynamic regions for raising capital”Nisha GopalanFinancial journalist
Philippe knows the IPO process inside out. Just as importantly, he explains complex concepts in clear and simple prose”Robert CooksonFinancial Times
When, what and how to talk to an investment banker to safeguard your interests (over theirs) and avoid common pitfalls. ‘Mr IPO’ has outdone himself with this rare, honest and meticulous ‘self-help’ book for companies/issuers planning to traverse the multi-faceted and complex IPO route”Anita Gabriel, Senior CorrespondentThe Business Times