Initial Public Offering

Pre-IPO Preparation

Preparing your company for an IPO application and ultimately obtaining approval from the U.S. Securities and Exchange Commission (“SEC”) is more than just meeting the fundamental quantitative listing requirements of the SEC. A company needs to have the appropriate system of controls and proper governance structures as demanded by the Stock Exchange, Auditors, the SEC, and the investment community. Therefore, depending on the existing conditions of your company including but not limited to the quantitative factors, the extent of existing control systems and governance structure, and other relevant factors, generally, the duration in successfully listing your company in the U.S. Stock Exchange can range from one year to several years before the first submission of an IPO application to the SEC.
Rest assured our specialists will accompany you in this long journey of taking your company public in the U.S. Early planning is a critical and decisive factor in ensuring the successful output of this mission. In the planning process, our specialists will assist you in the assessment of the IPO readiness of your company. Should the initial assessment suggest positive outcomes, our specialists shall proceed with assisting your company in the following changes in the course of meeting the fundamental listing requirements of the U.S. Stock Exchange.

• Auditors – We shall assist you with the engagement of the Company’s auditor who is registered with the Public Company Accounting Oversight Board (“PCAOB”);
• Board of Directors – introducing restructuring to existing members of the Board of Directors (the “Board”) by introducing a set of more independent directors;
• Reducing asset base – it is a general norm among the investment community in the U.S. whereby the community rewards companies that operate with minimal asset base. Our specialists shall work closely with the management and the Board of your company to realize this goal;
• Growth element – The investment community, in particular the institutional investors, are more willing to pay higher prices for company shares with proven track records of achieving high rates of growth on a year-on-year basis which suggests higher price/ earnings multiples. Our specialists will assist with reviewing various components of your business in advance of the IPO, and shall attempt to remove slow-growing or declining factors that hinder the growing prospect of your company;
• Revenue – in fostering a large and active market for a company’s stock, the company’s revenue needs to grow at a rate that meets the expected market capitalization threshold. Our specialists shall work alongside the management of your company in meeting this objective;
• Profitability – One of the key assessment factors by the investment community is evidence of translating high-growth revenue into outsized profits. In meeting this profitability objective, our specialists shall introduce a series of strong systems of cost controls and other relevant measures to meet the profitability benchmark;
• U.S. GAAP compliance and Closing Speed – our financial specialists shall work closely with your company’s finance team to ensure the financial reporting aspect complies with relevant U.S. GAAP. It is relevant to note once your company is successfully publicly listed, your company is under the statutory obligation to file financial reports within a relatively short time frame at the end of each fiscal quarter and year. Our specialists will work with the management in introducing the practice of early closing speed via developing a system and a series of training and coaching programs;
• Committees – Setting up of independent committees such as audit and compensation committees as part of the IPO process;
• Legal review – it is far more common for legal matters of a company, such as the legal structure, industry regulatory requirements, its contracts, and other legal matters, that could derail the IPO application at the last minute. We shall assist with engaging and working closely with relevant legal representatives to identify and correct these issues in advance to minimize any last-minute unexpected disruption in tandem with failing legal compliance;
• Management team – it is possible for existing members of the management team that do not meet the expectations of the IPO requirement, and so should be replaced. Our specialists will work closely with the Board and the management to take any necessary replacement actions in advance of the IPO so that new managers are fully settled in their jobs at the earliest time;
• Others – other matters may include setting up Research and Development (“R&D”) to improve and extend the lifespan of the lifecycle of the company’s products, introducing employee stock options for key personnel, working with the tax planning team in forming a long-term sustainable tax saving structure of your company, and more.