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Prospectus
Prospectus
A prospectus is a legal document that summarizes the information disclosed by a company going public. The information embedded in the prospectus is disclosed in greater detail, including the company's businesses, financial information, future directions, plans, and strategies in utilizing the funds raised through the IPO. It is crucial for every company with the intention to go public to disclose information at higher transparency, ensuring that the public can gain information regarding the newly listed company. Other names for the prospectus are "offering circular", "registration statement" or "listing documents".
Why is prospectus important?
Why is prospectus important?
The prospectus is legally the only document published by the company for investors to use and refer to in making their investment decisions. Since there is only limited information about the company before IPO, investors should refer to the prospectus in buying shares or certificates evidencing shares in an IPO. Investors should be well aware of the company's most recent registration statement and make sure that they refer to the recent filing, as there is a tendency to update information during the registration process. In short, investors are advised to verify the independent information acquired with the prospectus.
Contents of Prospectus for Equity IPO
Contents of Prospectus for Equity IPO
Chapter 1
INTRODUCTION
Chapter 1 is the cover page that includes the company's name, incorporation location, registration number, date of prospectus and several mandatory statements.
Chapter 2
PROSPECTUS SUMMARY
Chapter 2 provides a concise overview of the company with significant particulars disclosed elsewhere in the prospectus. This chapter must not exceed 10 pages, highlighting the summary of the principal details of the offering, business model, competitive position and business strategies, risk factors, directors and key senior management, promoters, use of proceeds, and etc.
Chapter 3
DETAILS OF OFFERING
Chapter 3 consists of offering details (e.g., the number of shares offered to specific groups of investors), history of market prices, plan of distribution, selling shareholders, dilution, and use of proceeds.
Chapter 4
INFORMATION ON PROMOTERS, SUBSTANTIAL SHAREHOLDERS, DIRECTORS, KEY SENIOR MANAGEMENT AND KEY TECHNICAL PERSONNEL
Chapter 4 includes information on the remuneration of directors and key senior management, management reporting structure, and declaration by each promoter, director, member of key senior management and key technical personnel.
Chapter 5
COMPANY'S INFORMATION
Chapter 5 includes detailed information on the company's background, business overview, material contracts, property, plant and equipment, employees, major customers, major suppliers, and exchange controls.
Chapter 6
RISK FACTORS
Chapter 6 includes information regarding risk factors that might have a possible adverse effect on the company's business operations, shareholders' investments, and financial position and results.
Chapter 7
RELATED PARTY TRANSACTIONS
Chapter 7 includes information on the relationship between the company and related party, types of transaction, particulars of the transaction, expiry date of the agreement between parties, the amount of transaction, and the percentage of the transaction.
Chapter 8
CONFLICT OF INTEREST
Chapter 8 includes information on the direct or indirect interest of a director or substantial shareholders in any company. The information includes whether the director's interest is for investment purposes only, the role of the director is limited to formulating corporate strategies or where the substantial shareholders' business may be a potential competitor to the company.
Chapter 9
FINANCIAL INFORMATION
Chapter 9 includes the general financial information that a company must include in the prospectus. Some of the information includes capitalization and indebtedness, discussions and analysis of financial conditions, dividends, taxation, and future financial information.
Chapter 10
REPORTS BY THE REPORTING ACCOUNTANTS
Chapter 10 includes the accountants' report, pro forma financial information, and future financial information.
Chapter 11
EXPERT'S REPORT
Chapter 11 includes the statement or report on the experts, disclosing such a person's professional experience. The report should be signed and dated within a reasonable time.
Chapter 12
ADDITIONAL INFORMATION
Chapter 12 discloses a summary of the provision of the company's constituent document relating to remuneration, voting and directors' borrowing powers, share capital changes, securities transfer, or liquidation of any special rights.
Chapter 13
INSPECTION OF AVAILABLE DOCUMENTS
Chapter 13 provides a statement that a copy of documents may be inspected for at least six months. The inspection will take at least six months from the prospectus issuance date at the registered office of the corporation in Malaysia, or if the registered office is not in Malaysia, at a place to be specified by the company.
Chapter 14
SHARES APPLICATIONS
Chapter 14 includes information that describes the results of the shares allocation made public and any excess application monies that will be refunded to applicants.
Chapter 15
SPECIFIC REQUIREMENTS FOR AN INFRASTRUCTURE PROJECT CORPORATION
Chapter 15 is specifically required only for an infrastructure project company. The information includes the concession, license, basis of business, construction risk, competition, operations, and other disclosure about the company's projects.
Chapter 16
SPECIFIC REQUIREMENTS FOR A SPECIAL PURPOSE ACQUISITION COMPANY
Chapter 16 is specifically required only for SPACs to include information on qualifying acquisition, valuation, time frame for completion, management capability, approval for qualifying acquisition, proceeds placed in a trust account, promoters or management agreement, custodian, delisting and liquidation, and other salient terms of the SPACs constituent documents.
Chapter 17
SPECIFIC REQUIREMENTS FOR A CORPORATION WITH MINERAL OIL AND GAS EXPLORATION OR EXTRACTION ASSETS
Chapter 17 is specifically required only for MOG company to include information on where disclosure on MOG exploration or extraction assets is included. Such disclosure must be presented following the MOG reporting standards, which must be applied consistently. Other information is the competent person's report and competent valuer's report.
Prospectuses of companies listed from 2000 to 2021
Prospectuses of companies listed from 2000 to 2021
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