Project case study:
Preparing a company for its initial public offering (IPO)

The challenge

The client was a successful and fast-growing professional services technology group that was going to pursue an initial public offering (IPO) on the UK AIM market. We were asked to join the IPO transaction team as a specialist adviser. Our role was to support the incoming Board members and management team with ensuring the company’s governance structures and processes were enhanced to a standard appropriate for a listed company. We were pleased that the client recognised the critical importance that strong governance arrangements play in building investor confidence, and were delighted to help build this.

Our approach

We knew from experience that strong planning and teamworking was essential to a successful outcome in any transaction of this kind. We started with agreeing the scope of our work with the client, then establishing a good rapport and clear accountabilities with the nominated adviser (Nomad) and the other members of the IPO transaction team.

An independent Chair and Non-Executive Directors were selected to join the company’s Board at the point of its AIM listing. We worked with the new Board to agree upon the most appropriate corporate governance code to adopt, selecting the QCA Code that is chosen by most AIM-listed companies. We agreed which Board Committees would be established, their remit and who would populate them. We then prepared a suitable Board charter and governance framework, including terms of reference for each of the Board Committees.

We also drafted a new suite of AIM-suitable corporate policies including on share dealing, inside information and conflicts of interest. We supported this set-up work with Board training covering directors’ duties, the AIM Rules, insider dealing and the QCA Code requirements.

Throughout preparations, we led on all governance-related input, working closely with the other professional advisers. This included review and supporting verification of the relevant parts of the Admission Document, drafting of the company’s new Articles of Association, and ensuring that the Day 1 Board minutes and resolutions covered all required governance elements to set the company up in the right way. We supported the process to select a Registrar, established a relationship with the chosen Registrar team and worked with them on behalf of the client on listing preparations and register building. This included arrangements for the issue of employee incentive shares to key leadership team members. We also established the core Board and Secretariat processes that would operate from listing.

The company did not have a dedicated Company Secretary, with these functions instead being shared by other executives. We advised the client on the greater responsibilities that needed to be discharged once listed, and the consequential increased resource required for a Secretariat function. We prepared a profile and list of responsibilities for a company secretary role, that was used by the client to seek a suitable candidate with listed company experience. We were well placed to support the selection process with a technical assessment of candidates’ skills and experience.

The outcome

All documentation and preparations for the IPO were completed to the agreed timetable, and a suitable Company Secretary recruited, which together put the client into a comfortable position of transaction readiness. The client praised our clear and straightforward explanations of complex concepts and documents, and appreciated the subject matter expert role that we played on governance matters in coordinating with the wider transaction team on the client's behalf.