Based on our direct conversations with stockbrokers, NOMADs, auditors and lawyers, an LSE AIM listed company valued at $100m would need to have (ultra conservatively) $8–10m in revenue and $0–1m in EBITDA. https://jason.com.ng/a-120-150m-ipo-for-iroko-in-2021/

1. IROKO - The IPO Process
October 2019

2. Outline
Which market?
Why list?
AIM IPO timeline
Preparing for listing
Q&A

3. Which market?
AIM:
- The LSE’s “junior market”
- Launched in 1995 to meet
needs of smaller growth
companies which might not
meet the full criteria for the
Main Market
- Lighter eligibility requirements
at IPO and on an ongoing basis
- Subject to the AIM Rules
Main Market:
- Principal market in London
- Premium v standard segment
- Eligible for inclusion in FTSE
Index Series (premium listing
only)
- Subject to the Listing Rules

4. Why list?
Advantages:
- Raises profile
- Provides market place for
shares
- Easier access to capital
markets
- Acquisition currency
- Opportunity for management to
partially exit
- Attractive for employees
- Provides comfort for suppliers,
customers and investors
Disadvantages:
- Public scrutiny
- Potential loss of control
- Subject to market conditions
- Onerous disclosure and
reporting obligations
- Increased costs and fees
- Impact on management time
- Additional director
responsibilities

5. AIM IPO timeline – Phase I
4 months prior to admission 3 months prior to admission 2 months prior to admission
Kick-off
• Kick-off meeting
• Agree engagement
letters with advisers
• Early look marketing
• Prepare data room
• Finalise pre-IPO
reorganisation structure
• Discuss board
composition and
corporate governance
structure
• Legal and financial due
diligence begins
• Skeleton admission
document available
Due diligence
reports circulated
• Draft legal due
diligence report and
financial long form
report available
• Reporting accountants
begin working capital
report and FPPP report
• Submit early
notification to AIM
• Nomad conducts site
visits and completes
director due diligence
• Continue drafting the
admission document
Verification begins
• Draft investor
presentation available
• Verification exercise
begins
• Draft connected analyst
research available
• Draft placing
agreement and other
key documents
available

6. AIM IPO timeline – Phase II
5-6 weeks prior to
admission
2 weeks prior to admission Admission
Research
• Connected analyst
research published
• Attend analyst
meetings (investor
education), if required
• Finalise terms of new
share option scheme
Marketing
• Complete all due
diligence and reports
• Placing agreement and
other key documents in
agreed form
• Finalise pathfinder
version of the
admission document
• Board meeting to
approve the pathfinder
and start of investor
roadshow
• Management attend
meetings with potential
investors
• Publish Schedule One
announcement
Admission
• Broker builds the book
• Agree price
• Shareholder meetings
to approve pre-IPO
reorganisation etc
• Board meeting to
approve final admission
document
• Sign placing agreement
and all other
documents
• Publish admission
document
• Admission 3 days later
• Dealings commence
• Placing proceeds
received

7. Preparing for listing – corporate structure
Changes to share capital
• One class of ordinary shares
• Change nominal value?
Shareholder arrangements
• Unwind special rights upon
admission
• Lock-in arrangements
• Relationship agreement
(unlikely to be relevant)
• Manage expectations for sell-
down
Appropriate corporate structure
• Re-registration as plc or insert new
holding company
• Driven by tax
• Dividend blockers/reduction of
capital
Share schemes
• Review existing arrangements
• How best to incentivise key
management and other employees

8. Preparing for listing – corporate governance
Board composition – split roles of chairman and CEO/implications for Jason
Independent NEDs - at least two independent non-executive directors with industry and listed company
experience (majority of NEDs if a premium list company)
Corporate governance standards are higher for a listed company – UK Corporate Governance
Code or QCA Corporate Governance Code
Committees - need to establish remuneration, audit and nomination committees
Senior management – any additions needed; are they sufficiently tied in?
Who else will join the board?
Significant shareholders – will any require board representation/existing directors remain post-admission?
Investors are highly focused on corporate governance issues

9. Preparing for listing – due diligence
Set up/refresh
existing data
room early
Purpose of legal due
diligence:
• Identify issues that need to
be:
(i) disclosed in the
admission document
(ii) rectified pre- or post-
admission
•Helps with drafting the
admission document
• Collects information to be
used for verification
Assets/IP – does the
group own these?
Contracts:
• Employment contracts
– novate or enter into
new contracts?
• Key contracts – check if
change of control
provisions

10. Preparing for listing – “time commitment”
Management time
commitment:
• IPO process is time consuming for
senior management
• Requires extensive due diligence
(legal, financial, commercial)
• Need to ensure business carries
on trading as normal
• Consider appointing additional
resource
Marketing roadshows:
roughly 2-3 weeks of meetings
(early look and deal roadshow)
Does any marketing
outside the UK need to be
factored in (e.g. US,
Europe or Africa)?

11. Contact details
Jack Shepherd
Corporate Partner
T +44 20 7524 6872
M +44 7775 025506
E jack.shepherd@cms-cmno.com
Louis Glass
Corporate Partner
T +44 20 7067 3347
M +44 7787 152731
E louis.glass@cms-cmno.com
Niall McAlister
Corporate Partner
T +44 20 7067 3581
M +44 7809 756199
E niall.mcalister@cms-cmno.
com
Katie Nagy de Nagybaczon
Corporate Partner
T +44 20 7067 3519
M +44 7841 492563
E katie.nagydenagybaczon@
cms-cmno.com

12. Recent CMS transactions – ECM and Public M&A
IPO and €155m fund raising for Aquila
European Renewables Income Fund.
£100m placing on AIM. £1.3bn recommended takeover by Stonegate Pub
Company
£140m AIM IPO and subsequent £12m placing. £34m AIM IPO. £24m AIM IPO and subsequent £18m placing and
open offer.
£392m recommended offer for MedicX Fund,
and £150m convertible bond.
£107m placing and open offer on AIM. IPO and US$200m placing and offer for
subscription.
£450m placing, open offer , offer for
subscription and share issuance programme.
£115.3m agreed takeover of online gaming
company Stride.
£39m placing and open offer on AIM.
Move from standard to a premium listing. £79m placing, open offer and offer for
subscription on AIM.
£141m block trade of shares in Main Market listed
Syncona.
ECMi H1 2019 report
1st for AIM deals by value
2nd for AIM deals by volume
3rd for all markets by volume

13. 13
CMS Legal Services EEIG (CMS EEIG) is a European Economic Interest Grouping that coordinates an organisation of independent law
firms. CMS EEIG provides no client services. Such services are solely provided by CMS EEIG’s member firms in their respective
jurisdictions. CMS EEIG and each of its member firms are separate and legally distinct entities, and no such entity has any authority to
bind any other. CMS EEIG and each member firm are liable only for their own acts or omissions and not those of each other. The
brand name “CMS” and the term “firm” are used to refer to some or all of the member firms or their offices.
CMS locations:
Aberdeen, Algiers, Amsterdam, Antwerp, Barcelona, Beijing, Belgrade, Bogotá, Berlin, Bratislava, Bristol, Brussels, Bucharest,
Budapest, Casablanca, Cologne, Dubai, Dusseldorf, Edinburgh, Frankfurt, Geneva, Glasgow, Hamburg, Hong Kong, Istanbul, Kyiv,
Leipzig, Lima, Lisbon, Ljubljana, London, Luxembourg, Lyon, Madrid, Manchester, Medellín, Mexico City, Milan, Monaco, Moscow,
Munich, Muscat, Paris, Podgorica, Poznań, Prague, Reading, Rio de Janeiro, Riyadh, Rome, Santiago de Chile, Sarajevo, Seville,
Shanghai, Sheffield, Singapore, Sofia, Strasbourg, Stuttgart, Tehran, Utrecht, Vienna, Warsaw, Zagreb and Zurich.
This presentation is intended to highlight potential issues and provide general information and not to provide legal advice.
You should not take, or refrain from taking, action based on its content. If you have any questions, please contact your main
contact partner at the relevant CMS member firm.
cms.law
Your free online legal information service.
A subscription service for legal articles
on a variety of topics delivered by email.
cms-lawnow.com
Your expert legal publications online.
In-depth international legal research
and insights that can be personalised.
eguides.cmslegal.com