There are many stock exchanges where different financial instruments are traded including equities, commodities, and bonds. At a certain stage of development, a company may wish to consider the opportunity of listing on a stock exchange to allow the company to benefit from improved access to capital, increased public awareness and greater access to liquidity.
A key motivation is to gain access to investors’ capital and as a way for the founders of a business to profit from a successful venture by selling some of their interest to new shareholders. It is not unusual for a business to wait until it has reached a certain level of maturity before joining a stock market, either to further grow the business or as an exit route. Listing comes with significant responsibilities and costs, understanding what your objectives are and early planning is essential. An issuer should have done extensive research prior to going down the listing route. Once listed a new chapter will begin in your business.
Why use the Isle of Man?
There are many benefits to forming companies and doing business in the Isle of Man. The Island has a strong and vibrant economy, a stable legal infrastructure and the longest serving unbroken parliament in the world. The Island is a popular location for establishing an entity to list your business for several reasons:
- Well-regulated and company law is long established and similar in many respects to company law in England.
- OECD compliant jurisdiction
- Stable tax regime with no capital gains tax, no inheritance tax, zero rate corporation tax (where applicable) no stamp duty on share transfers.
- Ability to settle CREST.
- Protection of Pre-Emption Rights.
- Strong Corporate Governance Regime.
- UK VAT and customs territory.
- Large network of professional advisors.
- High service levels
Which Stock Exchange?
Where an issuer is considering making a private company public it is important that an issuer chooses the appropriate exchange to list on and decide the type of listing. Choosing an exchange will depend upon your company’s size and objectives. Factors which also play an important role in the choice of stock exchange include type of exchange (not all exchanges are the same), listing and compliance costs, accounting standards and shareholder requirements.
Some popular exchanges to list a business are:
- The International Stock Exchange (TISE”)
A diverse Exchange, which has a responsive approach and competitive pricing. Often used as a platform for listing on other markets in the future. TISE headquarters is in Guernsey with operations across the Isle of Man, Dublin, Jersey, and London, uniquely positioned within the European time zone, but outside of the UK and the EU. Popular for listing Qualified Investor Bonds and UK REITs.
- AIM – the Alternative Investment Market.
A submarket of The London Stock Exchange, AIM was launched in 1995. AIM is an ideal market for small and medium sized companies with less onerous regulatory requirements than some other markets.
- The London Stock Exchange
A global platform for growth, enabling companies to raise capital and investors to build their portfolios across a range of global markets.
There are of course many other exchanges which may be appropriate to list your business.
Preparation
The key to a successful and smooth listing is found in the planning, assessing that a listing is right for you, choosing your advisers, essential in ensuring that all the market entry requirements are met. Defining your objectives are paramount. Exchanges will require different key advisers to be always in place. Aside from advisers, a public company’s board needs to comply with the various stock exchange listing rules which are to protect investors and ensure relevant information is shared with all investors in a prompt and transparent way. Compliance with good standards of corporate governance will help to ensure board independence and competence so they can deal with the new environment. Private company boards may not meet the standards expected, so advance planning can help to avoid unnecessary problems during the listing process.
Corporate Governance
Corporate Governance is the cornerstone of any good business encompassing the processes, practices, and policies that a company relies on to make formal decisions and to effectively manage a company. Corporate governance includes accountability, transparency, fairness, and responsibility. Implementing good corporate governance will ensure that the company protects its members, officers, management, suppliers and customers or clients.
How can we help?
Boston offers a variety of services to international and Isle of Man companies considering a listing. We can form Isle of Man Companies (as well as those in other jurisdictions) and provide management, administration, accounting and statutory services to those companies. A range of services can be provided to support the corporate secretariat and can be tailored to suit client’s needs.
We have significant corporate experience having worked on a number of AIM Admissions and a Main Market admission and ongoing services. Boston Sponsor Services Limited was the first Isle of Man TISE Listing Member and can act as Listing Agent for Qualified Investor Bonds and as Sponsor for Equities. Please contact us for more information enquiries@bostonmfo.com