IPO Glossary

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Glossary

Trading of an offering on or after the listing date.

The number of shares given to a client from an offering.

A government agency that regulates and enforces securities laws & protects investors. ASIC maintains a database of Australia's 1.2 million companies.

Australia's permier market for trading shares in listed companies.

A market where buyers determine the price, usually because of an oversupply of stock.

A system that manages the settlement of ASX stock trades.

The last transaction price for a stock on a particular day.

An underwriter that assists with the distribution of a offering.

Removal of a company from trading on the ASX, usually because of merger or insolvency.

A statutory officeholder of a company who is responsible for major decisions.

A process whereby a mutual organisation turns itself into a shareholder owned company. Members of the mutual organisation become the new shareholders.

The reporting of financial statements, management shareholdings and other information that can be used for making investment decisions.

The amount of money distrubuted to company shareholders out of net profits, usually biannually.

A process of verifying information about a company, including financial statements, management, market share, legal matters and risks.

An agreement whereby certain individuals and corporations must retain stock and not sell for a given time. Directors of newly listed company may have shares put in escrow.

A term used in Australia for raising capital and listing on the ASX.

The process of taking a private company (where the shares are in private hands) and converting the ownership to public hands (where shares are traded on the ASX).

An amount of shares that is reserved for issuing at the original price at the underwriter's option. This is used by the underwriter mainain an orderly market after listing.

A company that owns enough shares of another company to secure voting control.

The first time a company offers it shares to the public.

The price at which a new security will be sold to the public.

The lead underwriter who, among other things, is in charge of organising and distributing stock to the underwriters, and making stabilizing transactions once the new issue begins to trade.

The underwriter who, among other things, helps set the offering price and organises the other underwriters in selling a new issue.

A set of rules hat all companies must follow for trading on the ASX. They include disclosing decisions that may affect the share price.

The value that the market puts on a company, calculated by multiplying the shares outstanding by the share price.

Shares offered for sale to the public for the first time.

The first day a security is publicly offered for sale.

The price for which a new security issue will be sold to the public.

The register of public companies that trade on the ASX.

The difference between the opening price and offering price, given that the difference is positive.

The number of shares that have been issued by the company.

When the demand for shares in a new listing exceeds supply, the issue is said to be oversubscrived. There may be an opening premium in this case.

The change of ownership of a company from government control to private control.

The new issues that are due to go public withing a given timeframe.

An offering that is pushed back to a later date. This may lead to the offering being cancelled.

A company that has never been offered for sale publicly.

An investment in a company by a group of private investors.

A company document registered with ASIC to provide prospective buyers information about the company's financial performance, management, risks and prospects.

Considerations that are disclosed in the prospectus that might materially affect the company's financials, stock price, or reputation in a negative way.

Formal presentations made by underwriters usually to institutional investors to inform them of an issue.

When a public company issues additional shares to the public.

A market where there is more demand than supply for a security.

Investors in a company who sell part or all of their stake as part of that company's IPO.

The date that securities must be paid for.

Any person who owns shares of a company's stock.

For a fee the sponsoring broker manages the whole listing process, from putting the prospectus together through to marketing the float to the investment community. Unlike an underwriter, a sponsoring broker does not take on any of the risk that the issued shares are not fully taken up by offering to buy the shortfall.

The physical location where brokers transact business for their clients. The ASX is the principal stock exchange in Australia.

An additional document that is filed with ASX that has additional information regarding the proposed offering for the company.

An allocation of shares, made to a partiaular region or at a particular time.

A stockbroker or investment bank that sells shares in a new issue to the public. The underwriter will profit from the fees generated by the offering.

How the company plans to use the monies it generated from an IPO or Secondary.

The measure of what a company expecting to come public is worth.

Movement in the price of a stock from its high and low.

When a company decides to not continue with its proposed offering of securities. The reasons for this can be numerous and don't always signify trouble with the proposed offering. This term is sometimes used with the word cancellation.

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