{"id":131,"date":"2020-04-01T20:54:10","date_gmt":"2020-04-01T12:54:10","guid":{"rendered":"http:\/\/charltonsnaturalresources.com\/?page_id=131"},"modified":"2021-03-03T12:33:48","modified_gmt":"2021-03-03T04:33:48","slug":"pre-ipo-investments","status":"publish","type":"page","link":"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/pre-ipo-investments\/","title":{"rendered":"Pre-IPO Investments"},"content":{"rendered":"[et_pb_section fb_built=&#8221;1&#8243; admin_label=&#8221;ContentWrapper5&#8243; module_class=&#8221;content-wrapper5&#8243; _builder_version=&#8221;4.4.3&#8243;][et_pb_row admin_label=&#8221;Banner Top 5&#8243; module_class=&#8221;top-banner5&#8243; _builder_version=&#8221;4.4.3&#8243; background_enable_color=&#8221;off&#8221; background_image=&#8221;\/legal\/capital_raising\/capital_raising_banner.jpg&#8221;][et_pb_column type=&#8221;4_4&#8243; _builder_version=&#8221;4.4.3&#8243;][et_pb_text admin_label=&#8221;Banner 5&#8243; _builder_version=&#8221;4.4.3&#8243;]<div class=\"banner5\">\r\n<h1>Capital Raising<\/h1>\r\n<\/div>[\/et_pb_text][\/et_pb_column][\/et_pb_row][et_pb_row admin_label=&#8221;Breadcrumbs&#8221; _builder_version=&#8221;4.4.3&#8243;][et_pb_column type=&#8221;4_4&#8243; _builder_version=&#8221;3.25.3&#8243;][et_pb_text admin_label=&#8221;Breadcrumbs&#8221; _builder_version=&#8221;4.4.3&#8243;]<div class=\"breadcrumb no-bottom-border\">\r\n<ul><li><a href=\"\/\">Home<\/a><\/li><li><a href='https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/' title='Capital Raising'>Capital Raising<\/a><\/li><li><span>Pre-IPO Investments<\/span><\/li><\/ul>\r\n<\/div>[\/et_pb_text][\/et_pb_column][\/et_pb_row][et_pb_row column_structure=&#8221;1_4,3_4&#8243; module_class=&#8221;main-content5&#8243; _builder_version=&#8221;4.4.3&#8243;][et_pb_column type=&#8221;1_4&#8243; _builder_version=&#8221;4.4.3&#8243;][et_pb_text admin_label=&#8221;SideMenu&#8221; _builder_version=&#8221;4.4.3&#8243;]<div class=\"side-menu\">\r\n<div class=\"side-menu-panel\">\r\n<h3>Capital Raising<\/h3>\r\n<span class=\"hamburger\"><\/span>\r\n<\/div><ul class=\"cm-parent\"><li class=\"page_item page-item-127 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/private-equity\/\">Raising Private Equity Finance<\/a>\n<ul class='children'>\n\t<li class=\"page_item page-item-137\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/private-equity\/advising-natural-resource\/\">Advising Natural Resource Companies<\/a><\/li>\n\t<li class=\"page_item page-item-138\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/private-equity\/advising-investors\/\">Advising Investors<\/a><\/li>\n<\/ul>\n<\/li>\n<li class=\"page_item page-item-128 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/raising-debt-capital\/\">Raising Natural Resources Debt Capital<\/a>\n<ul class='children'>\n\t<li class=\"page_item page-item-141\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/raising-debt-capital\/advising-lenders\/\">Advising Lenders<\/a><\/li>\n\t<li class=\"page_item page-item-142\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/raising-debt-capital\/advising-borrowers\/\">Advising Borrowers<\/a><\/li>\n<\/ul>\n<\/li>\n<li class=\"page_item page-item-129 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/listing-debt-securities\/\">Listing Debt Securities in Hong Kong<\/a>\n<ul class='children'>\n\t<li class=\"page_item page-item-145\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/listing-debt-securities\/conditions-listing\/\">Basic Conditions for Listing<\/a><\/li>\n\t<li class=\"page_item page-item-146\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/listing-debt-securities\/options-warrants\/\">Options, Warrants and Similar Rights<\/a><\/li>\n\t<li class=\"page_item page-item-147\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/listing-debt-securities\/listing-document\/\">Listing Document<\/a><\/li>\n\t<li class=\"page_item page-item-148\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/listing-debt-securities\/listing-agreement\/\">The Listing Agreement<\/a><\/li>\n\t<li class=\"page_item page-item-149\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/listing-debt-securities\/tap-issues\/\">Tap Issues, Debt Issuance Programmes and Asset-Backed Securities<\/a><\/li>\n<\/ul>\n<\/li>\n<li class=\"page_item page-item-130\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/debt-issues-professional-investors\/\">Listing of Debt Issues to Professional Investors Only<\/a><\/li>\n<li class=\"page_item page-item-131\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/pre-ipo-investments\/\">Pre-IPO Investments<\/a><\/li>\n<\/ul>\r\n<\/div>[\/et_pb_text][et_pb_text admin_label=&#8221;SideNews5&#8243; _builder_version=&#8221;4.4.3&#8243; global_module=&#8221;231550&#8243;]<div class=\"side-news5\">\r\n\t\t\n\t\t<div class=\"rtc-image\">\n\t\t<a href=\"https:\/\/charltonsnaturalresources.com\/en\/mosaic-to-sell-brazilian-phosphate-mine-in-125-million-deal\/\"><img decoding=\"async\" src=\"https:\/\/charltonsnaturalresources.com\/wp-content\/uploads\/mosaic-to-sell-brazilian-phosphate-mine-in-125-million-deal.jpg\" \/><\/a>\t\t\t\t\n\t\t<h3 class=\"rtc-caption\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/mosaic-to-sell-brazilian-phosphate-mine-in-125-million-deal\/\">Mosaic to sell Brazilian phosphate mine in $125 million deal<\/a><\/h3>\n\t\t<\/div>\t\t\n\t\t\t\t\n\t\t<div class=\"rtc-image\">\n\t\t<a href=\"https:\/\/charltonsnaturalresources.com\/en\/mali-to-get-1-2bn-from-miners-after-talks\/\"><img decoding=\"async\" src=\"https:\/\/charltonsnaturalresources.com\/wp-content\/uploads\/mali-to-get-1-2bn-from-miners-after-talks-1.jpg\" \/><\/a>\t\t\t\t\n\t\t<h3 class=\"rtc-caption\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/mali-to-get-1-2bn-from-miners-after-talks\/\">Mali to get $1.2bn from miners after talks<\/a><\/h3>\n\t\t<\/div>\t\t\n\t\t\t\t\n\t\t<div class=\"rtc-image\">\n\t\t<a href=\"https:\/\/charltonsnaturalresources.com\/en\/friedland-considers-floating-african-iron-ore-company-on-asx\/\"><img decoding=\"async\" src=\"http:\/\/charltonsnaturalresources.com\/wp-content\/uploads\/friedland-considers-floating-african-iron-ore-company-on-asx.jpg\" \/><\/a>\t\t\t\t\n\t\t<h3 class=\"rtc-caption\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/friedland-considers-floating-african-iron-ore-company-on-asx\/\">Friedland considers floating African iron ore company on ASX<\/a><\/h3>\n\t\t<\/div>\t\t\n\t\t<h4 class=\"view-all-toggle\"><\/h4>\r\n<\/div>\r\n[\/et_pb_text][\/et_pb_column][et_pb_column type=&#8221;3_4&#8243; _builder_version=&#8221;4.4.3&#8243;][et_pb_text admin_label=&#8221;ContentMenuBar1&#8243; _builder_version=&#8221;4.4.3&#8243;]<div class=\"content-menubar\">\r\n<div class=\"page-menu-panel\">\r\n<h3>Friedland considers floating African iron ore company on ASX<\/h3>\r\n<span class=\"hamburger\"><\/span>\r\n<\/div>\r\n<ul class=\"cm-parent\"><\/ul>\r\n<\/div>[\/et_pb_text][et_pb_text admin_label=&#8221;banner content&#8221; _builder_version=&#8221;4.4.3&#8243;]<img decoding=\"async\" src=\"\/legal\/capital_raising\/pre_ipo_investments.jpg\" \/>[\/et_pb_text][et_pb_text admin_label=&#8221;Content&#8221; _builder_version=&#8221;4.4.8&#8243; background_size=&#8221;initial&#8221; background_position=&#8221;top_left&#8221; background_repeat=&#8221;repeat&#8221; hover_enabled=&#8221;0&#8243;]<h1>Friedland considers floating African iron ore company on ASX<\/h1>\r\n\r\n<p>A key part of the IPO process is securing subscribers for shares or other securities either before or as part of the IPO. Strategic investors provide valuable interim capital to companies on route to a listing and lend credibility to an offer encouraging further institutional and public interest. These investments may occur in advance of the listing (\u201cpre-IPO\u201d) or alternatively the investor may agree to commit to acquiring part of the IPO shares on the commencement of dealing of a company\u2019s shares (\u201ccornerstone\u201d). Investments may be made in ordinary shares or in other securities such as convertible bonds or preference shares.<\/p>\r\n<p>For mineral companies, particularly exploration stage companies, pre-IPO placements are often an integral part of the company\u2019s development strategy. Pre-IPO equity can be applied towards the finalization of a definitive feasibility study (the Hong Kong Stock Exchange Listing Rules (\u201cHKEX Listing Rules\u201d) require that estimates of mineral reserves are supported by at least a pre-feasibility study) or towards the development of plant and infrastructure.<\/p>\r\n<p>The Hong Kong Stock Exchange (\u201cHKEX\u201d) published a <a href=\"https:\/\/www.hkex.com.hk\/-\/media\/hkex-market\/listing\/rules-and-guidance\/interpretation-and-guidance-contingency\/guidance-letters\/guidance-letters-for-new-applicants\/gl43-12\" >Guidance Letter<\/a> on pre-IPO investments which was updated in March 2017. The Guidance Letter streamlines and clarifies the principles adopted by the HKEX in reviewing pre-IPO investments.<\/p>\r\n\r\n<p>The HKEX Listing Rules do not deal specifically with pre-IPO investments. The HKEX has in the past based its decisions on whether to allow the terms and conditions of particular pre-IPO investments to survive listing on whether they meet the requirements of HKEX Listing Rules 2.03(2) and (4) of the Main Board and Rules 2.06(2) and (4) of the Growth Enterprise Market (GEM). These Rules require that the issue and marketing of securities is conducted in a fair and orderly manner and that all holders of listed securities are treated fairly and equally.<\/p>\r\n\r\n<p>Pre-IPO investors may be offered special rights by the listing applicant or its shareholders. Special rights which do not extend to all other shareholders are not permitted survive after listing to comply with the general principle of even treatment of shareholders under the HKEX Listing Rules. The Guidance Letter provides various examples of which special rights must terminate upon listing and which may survive listing and on what terms they may survive listing. The HKEX\u2019s Guidance Letter on pre-IPO investments can be accessed <a href=\"https:\/\/www.hkex.com.hk\/-\/media\/hkex-market\/listing\/rules-and-guidance\/interpretation-and-guidance-contingency\/guidance-letters\/guidance-letters-for-new-applicants\/gl43-12\" >here<\/a>.  <\/p>\r\n<p>Pre-IPO investors are generally requested by the listing applicant to \u2018lock-up\u2019 their pre-IPO shares for a period of six months or more. These shares subject to the lock-up will be counted as part of the public float provided HKEX Listing Rule 8.24 (GEM Rule 11.23) is complied with. <\/p>\r\n<p>A listing applicant with a pre-IPO investment which is made within (i) 28 clear days of the first submission of the first listing application form (\u201cFirst Filing\u201d); or (ii) after the First Filing and before the listing applicant\u2019s listing, the listing applicant may not list until 120 days from the later of the completion of such pre-IPO investment or subsequent divestment. <\/p>\r\n<p>Clear days exclude the day the pre-IPO investment is completed, the day the listing application form is submitted and the first day the applicant\u2019s securities are traded. Pre-IPO investments are considered to be completed when the funds for the underlying shares are irrevocably settled and received by the applicant (in the case of an issue of shares by the applicant) or existing shareholders (jn the case of an issue of shares by existing shareholders). <\/p>\r\n<p>The HKEX\u2019s Guidance Letter on pre-IPO investments can be accessed on the HKEX\u2019s website <a href=\"https:\/\/www.hkex.com.hk\/-\/media\/hkex-market\/listing\/rules-and-guidance\/interpretation-and-guidance-contingency\/guidance-letters\/guidance-letters-for-new-applicants\/gl43-12\" >here.<\/a><\/p>[\/et_pb_text][et_pb_text admin_label=&#8221;SubpageMenu&#8221; _builder_version=&#8221;4.4.3&#8243;]<div class=\"page-submenu mb-40\"> \r\n<ul><li class=\"page_item page-item-13 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/about-us\/\">About Us<\/a><\/li>\n<li class=\"page_item page-item-231835\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/get-urls\/\">Get Urls<\/a><\/li>\n<li class=\"page_item page-item-234006\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/home-page-images-1\/\">Home Page Images 1<\/a><\/li>\n<li class=\"page_item page-item-353\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/\">Home Page New<\/a><\/li>\n<li class=\"page_item page-item-28 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/advising-companies\/\">Advising Resource Companies<\/a><\/li>\n<li class=\"page_item page-item-70 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/sponsors\/\">Sponsors<\/a><\/li>\n<li class=\"page_item page-item-93 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/mergers-and-acquisitions\/\">M &#038; A<\/a><\/li>\n<li class=\"page_item page-item-125 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/capital-raising\/\">Capital Raising<\/a><\/li>\n<li class=\"page_item page-item-155 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/listings\/\">Listings<\/a><\/li>\n<li class=\"page_item page-item-199 page_item_has_children\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/links\/\">Links<\/a><\/li>\n<li class=\"page_item page-item-8\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/home-page\/\">Home Page<\/a><\/li>\n<li class=\"page_item page-item-214\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/join-us\/\">Join Us<\/a><\/li>\n<li class=\"page_item page-item-215\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/contact-us\/\">Contact Us<\/a><\/li>\n<li class=\"page_item page-item-219\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/news\/\">News<\/a><\/li>\n<li class=\"page_item page-item-218\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/newsletters-and-subscriptions\/\">Newsletters and Subscriptions<\/a><\/li>\n<li class=\"page_item page-item-225\"><a href=\"https:\/\/charltonsnaturalresources.com\/en\/overseas-mining-laws\/\">Overseas Mining Laws<\/a><\/li>\n<\/ul>\r\n<\/div> [\/et_pb_text][\/et_pb_column][\/et_pb_row][\/et_pb_section]","protected":false},"excerpt":{"rendered":"<p>NATURAL RESOURCES News November 2024 Friedland considers floating African iron ore company on ASX &nbsp; On 12 November. 2024 mining tycoon Robert Friedland is reportedly planning to list his iron ore company, Ivanhoe Atlantic, on the Australian Securities Exchange (ASX) by mid-2024. The IPO aims to raise capital for investments in Australia\u2019s critical minerals projects, taking advantage of undervalued assets amid a downturn in [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"parent":125,"menu_order":4,"comment_status":"closed","ping_status":"closed","template":"","meta":{"_et_pb_use_builder":"on","_et_pb_old_content":"<!-- wp:paragraph -->\r\n<p>A key part of the IPO process is securing subscribers for shares or other securities either before or as part of the IPO. Strategic investors provide valuable interim capital to companies on route to a listing and lend credibility to an offer encouraging further institutional and public interest. These investments may occur in advance of the listing (\"pre-IPO\") or alternatively the investor may agree to commit to acquiring part of the IPO shares on the commencement of dealing of a company's shares (\"cornerstone\"). Investments may be made in ordinary shares or in other securities such as convertible bonds or preference shares.<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>For mineral companies, particularly exploration stage companies, pre-IPO placements are often an integral part of the company's development strategy. Pre-IPO equity can be applied towards the finalization of a definitive feasibility study (the Hong Kong Stock Exchange Listing Rules (\"Listing Rules\") require that estimates of mineral reserves are supported by at least a pre-feasibility study) or towards the development of plant and infrastructure.<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>The Hong Kong Stock Exchange (\"Exchange\") has re-published its interim guidance on pre-IPO investments which was originally published in October 2010 following a review of the Listing Rules in 2008. The Exchange has re-published this guidance ahead of a possible future consultation on the amendment of the pre-IPO placing guidelines and related Listing Rules.<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>The Listing Rules do not deal specifically with pre-IPO investments. The Exchange has in the past based its decisions on whether to allow the terms and conditions of particular pre-IPO investments to survive listing on whether they meet the requirements of Listing Rules 2.03(2) and (4) of the Main Board and Rules 2.06(2) and (4) of the Growth Enterprise Market (GEM). These Rules require that the issue and marketing of securities is conducted in a fair and orderly manner and that all holders of listed securities are treated fairly and equally. The Listing Committee has published Listing Decision Series 36, 55 and 59 relating to pre-IPO investments. For further information on these decisions, please see our newsletter of 3 November 2010 which is available <a target=\"_blank\" href=\"http:\/\/www.charltonslaw.com\/en\/newsletters\/20101103\/20101103-NewsLetter-HKLaw-detail.htm\" rel=\"noreferrer noopener\">here<\/a>.<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>The interim guidance letter on pre-IPO investments states that, generally and with rare exceptions, pre-IPO investments must be completed either:<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>(a) at least 28 clear days before the date of the first submission of the first listing application form; or<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>(b) 180 clear days before the first day of trading of the applicant's securities.<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>Clear days exclude the day the pre-IPO investment is completed, the day the listing application form is submitted and the first day the applicant's securities are traded. Pre-IPO investments are considered to be completed when the funds involved are irrevocably settled and received by the applicant. Exceptional circumstances may exist where it is acceptable for pre-IPO investments to be offered on terms more favourable than those offered to investors at the IPO stage, but the Exchange retains the discretion in giving exceptions to individual cases based on their own facts and circumstances.<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>The Exchange's <a href=\"http:\/\/www.hkex.com.hk\/eng\/rulesreg\/listrules\/listguid\/documents\/gl43-12.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">guidance letter on pre-IPO investments<\/a> can be accessed on the <a href=\"http:\/\/www.hkex.com.hk\" target=\"_blank\" rel=\"noreferrer noopener\">Exchange's website<\/a>.<\/p>\r\n<!-- \/wp:paragraph -->\r\n\r\n<!-- wp:paragraph -->\r\n<p>While the interim guidance provides clarity on the permitted timing for pre-IPO investments, there is still uncertainty as to the pre-IPO investment terms and conditions which will be allowed for investments complying with the timing requirements. The interim guidance encourages potential listing applicants to consult the Listing Division before submission of the listing application. If there are any potential questions as to the acceptability of any pre-IPO investment, the prudent course will be to approach the Exchange early to avoid having to amend the terms and conditions of the investment later in order for the listing to go ahead.<\/p>\r\n<!-- \/wp:paragraph -->","_et_gb_content_width":"","inline_featured_image":false,"footnotes":""},"categories":[28],"class_list":["post-131","page","type-page","status-publish","hentry","category-capital-raising","cat-23-id"],"_links":{"self":[{"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/pages\/131","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/pages"}],"about":[{"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/types\/page"}],"author":[{"embeddable":true,"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/comments?post=131"}],"version-history":[{"count":14,"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/pages\/131\/revisions"}],"predecessor-version":[{"id":232821,"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/pages\/131\/revisions\/232821"}],"up":[{"embeddable":true,"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/pages\/125"}],"wp:attachment":[{"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/media?parent=131"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/charltonsnaturalresources.com\/en\/wp-json\/wp\/v2\/categories?post=131"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}