Mechanics of Global Equity Offerings

by Brown, Meredith M.

• ISBN13: 9789041108555
• ISBN10: 9041108556
• Format: Paperback
• Copyright: 1995-09-01
• Publisher: Kluwer Law Intl

Summary

Mechanics of a Global Equity Offering is a clear, accessible look at the key issues involved in a global equity offering, including: which capital markets to tap, and how (public offering vs. private placement); which stock exchanges to list on; structuring the underwriting syndicates; due diligence questions; road shows and marketing activities; whether to disclose forecasts; which lawyers should give 'negative assurance' as To The disclosures in the prospectus; and how to negotiate representations, 'outs', indemnification and other terms of the underwriting agreements. A group of leading securities practitioners from different capital markets--the US, Hong Kong, France, Canada, Japan and Australia--take the reader through each stage, using a case study of a global IPO of an emerging markets issuer to illustrate the process. This book is a road map for securities lawyers, investment bankers, and senior finance officers of companies contemplating a global equity capital-raising exercise.

Table of Contents

About the IBA, the Section on Business Law	vii
About the Editor and Contributors	xi
Foreword	1	(4)
Introductory Remarks	5	(1)
The Case Study: A Global Equity Offering by Shanghai Widgets	6	(2)
An Overview of the World's Equity Capital Markets	8	(1)
Charts	9	(94)
How to access the capital markets? Fully registered offerings vs. private placements	19	(6)
The United States: Full Registration vs. Rule 144A
Public vs. non-public offerings in the U.K.
Japan: Public vs. non-public offerings
Different classes of stock for Chinese issuers	25	(1)
``Road shows,'' research reports and other marketing activities	26	(3)
Is the basis for disclosure liability pretty much the same throughout the world?	29	(6)
Japan
United States and United Kingdom
France
Australia
Canada
How to guard against liability: different approaches to due diligence	35	(8)
Australia U.S. and U.K. practice: Herein of verification rules
The underwriter's perspective
Particular due diligence issues for Chinese issuers
Structure of the Offering	43	(13)
Who's the issuer?
What kind of securities are to be offered? Herein of ADRs and GDRs
Access to intermediate-sized capital markets: the example of Canada
The overallotment or ``Green Shoe'' option
Pre-emptive rights
Protecting investors: Who can be sued, and where?	56	(1)
Structuring and coordinating the offering	57	(6)
How may syndicates and agreements?
When are the underwriters bound?
Issues in negotiating the Underwriting Agreement	63	(37)
Governing law
Lockups
Representations and warranties
Survival of representations and warranties
Representations and warranties of the underwriters
The underwriters' ``blood letter'' identifying the portions of the prospectus vouched for by the underwriters
Assurances as to the issuer's ongoing disclosure responsibilities
Conditions to the underwriters' obligations: The ``market out'' and other ``outs''
Opinions of counsel
``Negative assurance'' letters: Which law firm gives them, and under what circumstances?
The auditor's cold comfort letter
Consents to service of process and submission to jurisdiction
Indemnification and contribution---and legal questions as to the enforceability of indemnification provisions
Coda: U.S. vs. U.K. underwriting agreements	100	(3)
Appendix I: Negotiating an Underwriting Agreement	103	(10)
Appendix II: Additional Notes on Issues in Negotiating an Underwriting for a Global Equity Offering	113	(46)
Appendix III: Comparison of Two Agreements	159	(26)
Index	185