Other than removing the layer of excessive time and cost burdens often levied on both companies and investors, the Asset Match IPO Accelerator process operates on a system that is proven to:
- Provide a level playing field for all investors.
This means specifically that all potential investors – regardless of their size or relationships with investment banks or corporate brokers – have an equal opportunity to participate and acquire shares in the company; something that many IPOs have not catered well for in recent times.
The Asset Match IPO Accelerator applies the “Dutch Auction” process through which to ensure a fair and accurate setting of a market-driven and market-related pricing model.
This method ensures that there is total transparency in respect of the offering, the market’s interest in the offering and the price which the market is prepared to pay for the offering – as well as a level and open playing field that allows all and any interested parties an equal opportunity to participate in the offering. It is for this reason that market leading companies such as Google applied the Dutch Auction process in their IPOs, and, as Cornell University has stated in its study of “Dutch Auction” processes “There are many benefits of the Dutch Auction system – the strategy-proofness of the auction makes bidders bid their true value for a share of the company and it allows more potential investors because anyone can issue a bid.
By allowing more potential investors companies are able to raise their true capital valuation and not “leave funding on the table”. This refers to when share prices jump initially after IPO so the company misses out on capital they could have gotten if they were correctly valued”.
Getting to the IPO Accelerator Platform:
This is reached by clicking on the “Login” button at the top of the website, and logging in (you have to have Registered as an Investor, Company, Broker / Intermediary or Guest to be able to log in).
Once you have logged in you will be on the IPO Accelerator process platform, where the actual live IPO Acceleration process is taking place.
The trading platform, bids, bidders, prices, progress and all possible information on the company will be available to see and follow, and If you have registered as an Investor, you will be able to participate in the IPO Accelerator process directly and immediately.
How the company’s “Global Roadshow” is presented:
The IPO Accelerator platform provides companies with the opportunity to present a “Global Roadshow”.
The IPO Accelerator platform frees companies from the conventional limitations of only being able to provide a roadshow to investors in one geographic location or to only a limited number of investors with time constraints.
It also assists both companies and investors by providing access to the full spectrum of information on the company – ensuring that the company is able to make a complete presentation, and potential investors are able to access all information that is of relevance or interest to them – as opposed to just getting one standard and usually limited information pack which may or may not be to the level of detail – or on the subjects of interest required by different profiles of investors.
The company’s information is presented on a series of tabbed pages below the actual bidding platform, and it contains all relevant summaries, documents, reports, videos and other relevant material, which potential investors can review or download at their own convenience.
How investors can participate:
The IPO Accelerator process has been specifically constructed to enable investors to take advantage of global investment opportunities in a way that provides for ease of review and decision-making, access to comprehensive company information, an easy to effect and rapid investment process, the ability to invest with no intermediary costs, and a safeguard in terms of a final decision as to whether to proceed with an investment.
Once an Asset Match Registered Investor has logged in to the IPO Accelerator process platform, they are able to review all relevant information of the company at their convenience, and are also able to see the status of bids, bidding process and bid prices.
They are then able to enter their own bid in an extremely easy-to-use and easy to follow process,
How the IPO Accelerator’s “Dutch Auction” process works:
The “Dutch Auction” process provides a transparent, fair and equitable means for setting a market-related share price for a company’s shares.
In the process, bidders bid for the shares at prices that they deem to be consistent, and the average bid price at the end of the auction is set as the price at which the shares will be sold.
For example, if a series of bids were made at the following prices:
- Bid 1: US$ 1.00 per share
- Bid 2: US$ 1.50 per share
- Bid 3: US$ 2.00 per share
The total value of the bids would be added (US$ 1.00 + US$ 1.50 + US$ 2.00 = US$ 4.50), and it would be divided by the number of bidders (3).
The average share price would therefore be US$ 4.50 divided by 3, which would be US$ 1.50 per share; and that would be the share price at which the shares were sold at the end of the auction.
How the final share price and share allocations are set:
In the event of significant oversubscription:
- The Average Share price is taken as the price at which the shares will be sold.
- Only bidders who have bid at or above the Average Share Price will be able to close their sale and purchase shares.
- The number of shares that these bidders will be able to buy will be the total amount of funds that they bid, divided by the average share price.
In the event of oversubscription:
- The Average Share price is taken as the price at which the shares will be sold.
- All bidders – including those who bid above and below the Average Share Price – will be able to buy allocated shares.
- The quantity of shares that these bidders will be able to buy will be the total amount of funds that they bid, divided by the average share price.
In the event of adequate subscription:
- The Average Share prices bid and the number of shares bid for are taken into account.
- The bid price at which a sufficient number of shares will be taken up by bidders to reach an adequate (i.e.
complete) subscription will be set as the Share Sales Price.
- All bidders will be able to purchase shares at the Share Sales Price (which is sometimes marginally lower than the Average Share Price).
- The number of shares that bidders will be able to buy will be the total amount of funds that they bid, divided by the Share Sales Price.
Investors’ opportunity to confirm their investment decision:
To provide an additional level of comfort to investors, bids during the IPO Accelerator process are classified as expressions of interest, but are not binding.
Once the IPO Accelerator process auction is closed, all investors who have bid are contacted, and can at that time elect to close on their bids and purchase shares in a Settlement Process, or they can decline to close on their bids and do not implement a Settlement Process.
This ensures that all investors are able to choose to go through with their purchase at the final share price or not.
Safeguarded settlement process:
Once the final share price has been set at the end of the IPO Accelerator process, all investors who had entered bids are contacted by the Settlement Team.
The Settlement Team are representatives of an independent fiduciary services organisation that will administer the share sales process.
WeWork pulls its IPO due to an inability to match its valuation number
The process is as follows:
- Investors who have bid are contacted by the Settlement Team, and are offered the opportunity to close on their bids and purchase shares based on the amount of funds that they bid, divided by the final share price, to reach the total number of shares that they may purchase.
- If the investor chooses to proceed with the purchase, they are provided with the relevant share purchase and “Know your Client” (KYC) documentation to complete.
- The completed share purchase documentation and KYC documentation is completed, it is sent to the Settlement team, and the purchase funds are wired to the Settlement Team’s trust account.
- At that time, the Settlement Team authorises issue of company shares to the investor, receives the share certificates from the company, and despatches the share certificates to the investor.
- Once the investor confirms receipt of the share certificates, the funds are released to the company.
Safeguards against price manipulation:
In order to prevent price manipulation during the IPO Accelerator process, the following safeguards are applied:
- The company is able to set a “Reserve Price” under which bids will not be accepted.
The Reserve Price is the price that the company’s shares have previously been placed at.
- An “Indicative Price” – which is the minimum market price that the share value is currently professionally assessed to be – is placed openly on the IPO Accelerator page.
- All bids are transparently displayed in real time.
- The Asset Match team will contact and enquire from investors as to their motivations if they submit bids which are clearly at odds with trends, to ascertain whether there is a valid reason for doing so, and will remove bids if there is a suspicion that there is an attempt at price manipulation to drive their price either artificially high or artificially low.
The IPO Accelerator process has multiple safeguards for investors, including –
- Companies have due diligence carried out on them by Asset Match prior to their being permitted to participate in an IPO Acceleration process (Note: Regardless of this fact, each investor is responsible for his or her own investment decision, and the fact that Asset Match carried out due diligence to its satisfaction is not to be considered an endorsement or the company, nor an encouragement or solicitation for any person or entity to purchase shares in any company).
- A market-related indicative share price for the company’s shares is provided.
- An extremely wide range of all relevant information on the company is provided in order to allow for a comprehensive view to be taken by an investor.
- The bidding process is open and transparent.
- Safeguards are in place to prevent price manipulation.
- An open and level playing field is provided to all investors, giving equal access and opportunity to all interested parties.
- A “Dutch Auction” bidding process is followed to provide a fair, transparent and market-driven share price.
- The final share price is reached in an open, transparent and market-related manner.
- Investors are able to alter their bids during the auction process.
- Investors are not bound to take up their shares by their bids, and only commit to their purchase at the final share price after the conclusion of the IPO Accelerator process – and they also have the opportunity to decline to go through with their share purchase at that time.
- Shares are allocated transparently and equally to investors based on the amount of funds that they bid.
- Investors who go through with their share purchase have a safeguarded settlement process, implemented by a reputable fiduciary services company.
The IPO Accelerator process has multiple safeguards for companies, including –
- The company is able to present its value-proposition, and all its relevant information, to a global pool of potential investors, in an open and transparent manner.
- The company is able to set a Reserve Price at the price which it last placed shares.
- Asset Match provides a professional market-related minimum “Indicative Price” to accurately guide investors opening bids.
- The bidding process is transparent, and geared towards setting a market-driven price for the company’s shares.
- Investors have to register with Asset Match and provide their details prior to their being able to bid, so the investor base is reputable.
- There are no hidden costs to companies during this process.
Broker and intermediary safeguards:
The IPO Accelerator process provides the following safeguards for brokers and intermediaries -
- If a broker or intermediary refers an investor and the investor signs up as a registered investor with Asset Match, that investor is registered as having been referred by the referring broker or intermediary.
- Thereafter, whenever the referred investor makes an investment on the Asset Match IPO Accelerator platform, the referring broker or intermediary will receive a 2% commission on the investments made by the referred investor/s.
How to get started and participate:
To get started and participate in an IPO Accelerator process, simply click on the relevant Registration category on the left, register, and then click on the “Login” button above, and log in to the IPO Accelerator.