The opportunity to register a company in Northern Ireland attracts a considerable number of entrepreneurs and investors from all over the world who want to do business in prestigious jurisdictions.
In this article, we will look at the key features and benefits of introducing a company to an IPO in Northern Ireland.
A company's listing on the stock exchange is often seen as evidence of its success. Over the past 2 years, the number of publicly-traded companies in Northern Ireland doubled to four.
In March this year, Diaceutics, a Belfast-based research firm, placed shares on the Alternative Investment Market (AIM) of the London Stock Exchange (LSE).
This happened after Fusion Antibodies, a contract research organization, joined AIM at the end of 2017.
Kainos Group began trading in the main LSE market in 2015. The Kainos Group has risen quite rapidly in the ranking, becoming the first company headquartered in Northern Ireland to reach the FTSE 250.
The success of these companies can be a great precedent for ambitious companies. But preparing a company for an IPO is not a matter of urgency. Instead, companies should fully understand the process and also identify potential flaws.
Listing Pros and Cons
If you intend to bring a company to IPO, you should know that the main advantage of an IPO can be the ability to attract a large amount of capital to reduce debt or increase the amount of invested funds, especially if the company has already exhausted other sources of financing.
Listing can significantly add to the company’s positive image outside the existing market and increase confidence in it. It will also help to open up new opportunities, as financiers, customers and suppliers will be able to access more information about the company, as well as verify its reliability by checking the due diligence the company will go through to register on the exchange.
After the company's shares begin to circulate on the stock exchange, it will be easier for investors to assess the situation and return their investments.
In addition, those who are interested in legal support for an IPO in Northern Ireland should be aware that separation of ownership and day-to-day management of the company can also be an advantage, giving management the opportunity to focus on business strategy.
Points of Concern
Listing means that the company may lose control over investors and find that the shareholder base is becoming increasingly fragmented. Interaction with shareholders will require additional efforts and reporting.
Other disadvantages of IPOs include the inevitable lack of confidentiality, as stringent disclosure and reporting requirements make commercial information generally available.
Entrepreneurs who would like to prepare a company for an IPO in Northern Ireland should keep in mind that a strengthened corporate governance regime may require a gradual change in their approach to board composition and stakeholder engagement.
Successful recognition or listing of a growing number of organizations shows that the ambitious, stably developing companies of Northern Ireland can keep their position at the next level.
Due to the fact that this jurisdiction is increasingly becoming a leader in a number of industries with global experience and serving an increasing number of foreign customers, the IPO promises the advantages described above.
However, in any business, the costs and efforts should be carefully calculated, related not only to the procedure for preparing for an IPO, but also to ensure that the company trades in securities on an ongoing basis.
That is why the introduction of processes that ensure timely disclosure of any potentially price-sensitive information or transactions is extremely important for a public company.
Seasoned specialists from YB Case are ready to provide you with professional legal services at all stages of the IPO of the company. We will advise on all aspects of transactions in capital markets, as well as provide assistance in the process of preparing for an IPO in Nothern Ireland. For more details, please sign up for an individual consultation at the contacts listed below.