CASE 4: SOCIAL MEDIA BUSINESS – CORPORATE DEVELOPMENT STRATEGY
Is listing a viable option?
Saint Gabriel was a corporate advisor to an social media business on its corporate development initiatives, including listing on a stock exchange.
The company is located in North America, and the founder and investors are Australian. The business was seeking funding and required guidance on listing on the Australian Securities Exchange (ASX). Saint Gabriel worked closely with the company’s Board and executive team to provide advice and manage the process. We reviewed the business’ strategy and plan, its historical corporate funding initiatives, funding requirements and provided advice on the specific requirements for the business to list on the ASX. This included the technical aspects of listing and the pros and cons of an initial public offering (IPO) versus a reverse takeover (RTO).
To address the divide in opinions on an ASX listing, we went out and tested the market. This included meeting directly with stockbroking firms and investors and gathering their thoughts and level of interest. We introduced and met with professional consultants who would normally be involved in the listing process, including ASX listed shells for an RTO, industry experts, legal advisors, auditors, and independent accountants. This process gave our client an understanding of what to expect should they decide to go down a listing path and how a listing may and may not align with their corporate development plan. We also structured potential pre and post listing capital raising issues for the business.
Saint Gabriel attended to important corporate matters and agreements for the business that needed addressing in preparation for future funding.
The advisory process enabled the company’s Board to decide the business was not ready for a listing on the ASX. The business was restructured and continued to be privately funded.