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Tuesday, April 19, 2011

Frankfurt Listings with Merger Law Associates

Frankfurt Listings: We will assist taking your company public on Frankfurt Stock Exchange (FSE) in two ways, through a Direct Public Listing (DPL), subject to qualification or through one of the company’s fully qualified listed shells (SPAC) used for quick listings doing a Reverse Merger (RTO) or Share Exchange Agreement (SEA)of your existing company. Either way Frankfurt Listings can have your company public in less than 5 days if need be.
Why list on the Frankfurt Stock Exchange
Listing on the Frankfurt Stock Exchange locates your company in one of Europe´s most important financial centers Frankfurt Stock Exchange operates one of the most efficient stock markets in the world. By holding your IPO at the Frankfurt Stock Exchange you can develop into a truly global company and bolster your equity base for long-term projects. You can improve your competitive positioning and your growth strategies more efficiently by a full listing on one of Frankfurt Stock Exchange primary market segments.
Benefits of a listing on Frankfurt Stock Exchange
•  Access to national and international investors.
•  Balanced regulation and high market credibility.
•  Saving time and money with a simple and cost- efficient listing process.
•  Fastest admission listing process worldwide.
•  Predicable time schedule for DPL.
•  Great attention especially for high-tech and “green” companies.
•  Strong peer groups and internationally established indices e.g. Cleantech, Renewable Energies, High Tech Engineering.
Overview of Frankfurt Stock Exchange market segments and transparency levels
Overview of FRANKFURT STOCK EXCHANGE market segments and transparency levels
Variety of market segments and transparency standards
The Frankfurt Stock Exchange provides companies with two market segments that consist of different transparency standards. These segments and standards are designed to meet the different capital needs of companies and their investors from around the world. Prime Standard has the highest level of transparency in Europe and is the first choice for companies planning a major and sustainable IPO. General Standard is based on minimum EU-regulation. Entry Standard offers low costs and flexible access.
An inclusion in First or Second Quotation Board means even less stringent formal requirements.
Main market Prime Standard
The Prime Standard is tailored to the needs of companies seeking to attract global investors and to enhance substantial future growth at comparably low cost of capital.
Overview of admission requirements for Open Market
IssuerMust be capitalized at €500,000 Eruo and have a par value of € 0.10 Euro or have a prospectus filed.
Accounting standardsEU-issuers: IAS/IFRSNon-EU issuers: IAS/IFRS or standards equivalent.
Reporting history3 years Exemptions possible (e.g. SPACs).
Minimum issuing volumeN/A
Minimum market capitalization€500,000
Initial free floatN/A
Free transferability of securitiesRequired
ApplicantIssuer together with a bank or a financial services institution. Either the issuer or the bank / financial services institution must be admitted to participate in stock exchange trading on a German securities exchange.
Most competitive fees:
Frankfurt Stock Exchange offers the most competitive admission and annual listing fees compared with its peers, e.g. NYSE, Euronext, LSE, HKSE (Prime Standard: €3.000 admission fee, €2.500 introduction fee, €10.000 annual listing fee) Open Market is even less.
Key factors for a successful DPL:
The main tasks to bring a company into shape for going public are as follows:
  • Preparation of a well constructed, attractive equity story, supporting the central statements by reliable data and information.
  • Establishing high quality corporate governance standards underpinned by robust management information and management reporting systems.
  • Composition of the historical financial track record, if necessary conversion to IFRS.
  • Assessment of the existing capital, organizational and tax structure.
  • Implementation of legally compliant processes, to be able to fulfil ongoing reporting requirements and to establish an efficient capital market communication process.
  • Management and employee incentive arrangements.
How Frankfurt Listings can support You
DPL Project Management
  • DPL Readiness Analysis.
  • Preparing detailed timetable and  milestones.
  • Coordination of all DPL activities.
Financial Information
  • Early involvement in the GAAP conversion process.
  • Audit of IFRS / Chinese GAAP financial statements for the past 3 years.
  • Advise on Integration of internal and external reporting processes.
Business planning & valuation
  • Analysis of financial and  strategic profile.
  • Assistance in the development of an equity story.
  • Business enterprise valuation based on the business plan and on market data.
Legal & Tax
  • Assist in implementation of a tax beneficial group structure.
  • Assistance in conversion to a German AG.
Corporate Governance
  • Assist with Implementation of German Corporate Governance Codex.
  • Assist with Implementation of a Risk management system.
  • Assistance in connection with the German enforcement process.
  • Advise with respect to all publicity Requirements.
  • Assist with implementation of an Investor relations function.
  • Assist with implementation of a Compliance Office and compliance reporting.
Timeline for an DPL:
With all the proper documents prepared and submitted by us ,we can have you company listed and trading within 3-6 weeks.
The company also has listed shells available for immediate sale and quick listing . You can be public in 5 days and trading.

Frankfurt Listings: Merger Law Associates is the Firm choice for Belgrade Stock Exchange listed companies to do a dual listing on the Frankfurt Stock Exchange (FSE)

London , UK, April 19th , 2011

With the pending merger of the Frankfurt Stock Exchange and the NYSE Euronext … this will become the world’s largest stock market by capitalization. Can your presently listed company afford not to consider a dual listing in this market. Merger Law Associates Ltd. does not think so. The advantages are many!

Now is the time to look at being dually listed.

Right now the Frankfurt Stock Exchange is the world’s third largest trading center for securities and Germany’s largest exchange. It is responsible for 90 percent of the securities trading volume in Germany. The Exchange facilitates advanced electronic trading, settlement and information systems and enables cross-border trading for international investors.

And German investors, both institutional and private, are now actively searching for small to mid-size companies to invest in. With a new investment climate in Europe and changes in the OTC market in Germany the time is now ripe for all companies to enter the European public markets.

The Frankfurt Exchange offers many strategic advantages for companies already listed:

Access to new markets and investors. A listing on the Frankfurt Stock Exchange will introduce your company to a whole new market – the German speaking Euro-economic market primarily consisting of Germany, Switzerland, Austria and Liechtenstein. This market, consisting of more than 100 million people, has the fastest rate of growth and the highest income per head in the EU. Many of these people are very active in world financial markets. And more and more affluent retail and institutional investors are searching European stock exchanges and financial websites to help make their investment decisions and we can help put you on their radar screen.
Low costs and maintenance.
Relaxed regulation.
Very inexpensive.
Sophisticated Investors.

European investors invest for the long term. And in most European countries there are major tax benefits for holding on to purchased stock for a certain amount of time as opposed to “dumping” it immediately into the market. The lack of investors that instantly sell a company’s stock allows for stability in stock price and opportunities for growth.

Dual-Listing on Frankfurt Exchange.

Increase Daily Average. A way to increase a company’s average daily trading-volume and share price.

Purchase with local currency. Gives European investors the opportunity to buy shares of any listed companies with Euros.

Our Dual Listing Benefits

Access to new markets and investors. A listing on the Frankfurt Stock Exchange will introduce your company to a whole new market – the German speaking Euro-economic market primarily consisting of Germany, Switzerland, Austria and Liechtenstein. This market, consisting of more than 100 million people, has the fastest rate of growth and the highest income per head in the EU. Many of these people are very active in world financial markets. And more and more affluent retail and institutional investors are searching European stock exchanges and financial websites to help make their investment decisions and we can help put you on their radar screen. The strong euro makes North American stocks very attractive.

About Merger Law Associates

Merger Law Associates Limited is a 21st Century financial consulting practice catering to growth-oriented companies seeking the many benefits of being a public company. It’s primary focus is bringing companies public on the Frankfurt Stock Exchange. With over a decade of experience in the public markets and the Frankfurt Exchange, Merger Law Associates has the knowledge and experience needed for your firm to become publicly or dually listed in a prompt, professional and cost-efficient manner.

If you are already listed on a qualifying exchange or if you are a private company wishing to explore a Direct Public Listing on the Frankfurt Stock Exchange

Contact us at Merger Law Associates or Julius Csurgo today

Thursday, January 13, 2011

Deutsche Börse Most Attractive Listing Venue in an International Comparison

Study confirms that Frankfurt offers highest liquidity and lowest capital costs/ Considerable IPO potential among German SMEs

Deutsche Börse offers companies the lowest capital costs among the world’s leading stock exchanges. This is the conclusion reached by an independent study presented by Professors Christoph Kaserer (Munich’s Technische Universität ) and Dirk Schiereck (European Business School ) at the German Equity Forum on Monday. Deutsche Börse offers the lowest capital costs in all three segments - Prime, General and Entry Standard - for both the actual IPO and for ongoing listing. Liquidity on the Frankfurt stock exchange is also higher than at the other trading venues.

The study confirms the results of a survey published by the professors last year. The current study compares the terms and conditions that apply to a listing with Deutsche Börse with those on the following exchanges: Euronext, Hong Kong Stock Exchange, London Stock Exchange, Nasdaq and the New York Stock Exchange. A total of over 2,200 IPOs were examined over the period from January 1999 until March 2007.

The attractiveness of the various exchanges for issuers was analyzed using a valuation system developed by the professors, which is based on eight criteria. These parameters measure a number of factors including the costs of market access, the subsequent costs for further capital increases and liquidity. With an overall score of 2.0, Deutsche Börse’s Prime Standard and General Standard come in 1st compared to the other main markets, followed by Hong Kong’s Main Board (2.9), the NYSE Large Caps (3.0), Euronext’s Eurolist (3.1), the LSE’s Main Market (3.4) and Nasdaq’s Large Caps (3.5). As far as the alternative markets are concerned, the Entry Standard is in pole position with an overall score of 1.9. It is followed by the NYSE Small Caps with a score of 2.6, Euronext’s Alternext (2.8), the Nasdaq Small Caps (3.0), the LSE’s AIM (3.4) and the Hong Kong Growth Enterprise Market (GEM) (3.5).

The total costs of an IPO in Frankfurt average 8.3 percent of the issue volume. Deutsche Börse offers significantly lower overall costs than Nasdaq (9.5 percent), London (12.6 percent) and Hong Kong (14.6 percent). The zero-trade ratio (ZTR) was also examined. This parameter shows the ratio of days without trading in a particular share to the trading days. A low ZTR means that trading activity is high. The study shows that Frankfurt has the highest liquidity in an international comparison, both among the main markets and in the alternative segment. The ZTR in the Prime Standard and the General Standard, as well as in the Entry Standard, comes in at 1.39 percent. By means of comparison, London’s Main Market scores 9.15 percent and its AIM 39.89 percent, while Hong Kong’s GEM also returns a far higher ratio with 33.42 percent.

Frankfurt’s Entry Standard also offers the lowest spreads, i.e. the difference between the buy and sale price, with 2.23 percent, compared with 4.15 percent on the GEM, 4.52 percent on Alternext and 7.22 percent on the AIM. The Prime Standard and General Standard also offer extremely low spreads at 0.62 percent, followed by Eurolist (0.71 percent), Nasdaq (0.74 percent), Hong Kong’s Main Board (1.04 percent) and the LSE’s Main Market (2.0 percent).

“The results of this independent study once again confirm Frankfurt’s attractiveness as a listing venue in a global comparison – for small, medium-sized and large companies alike”, said Rainer Riess, Managing Director, Cash Market Development at Deutsche Börse.

Deutsches Aktieninstitut presented a study on German listings at the Equity Forum. German SMEs show considerable potential for future IPOs. This is the main conclusion reached by a survey performed by Deutsches Aktieninstitut in cooperation with Deutsche Börse AG. All in all, around one quarter of the companies surveyed are either aiming to go public, or are at least considering an IPO in principle. “Compared to 2003, when we published the results of a similar survey, SMEs have increased their capital market focus considerably”, said Rüdiger von Rosen, Head of Deutsches Aktieninstitut. This is an encouraging sign for the acceptance of equities as a financing instrument.

Deutsche Börse and KfW Mittelstandsbank have been organizing the German Equity Forum twice annually since 1996. With over 5,000 participants, the German Equity Forum is one of the major capital market conferences for companies seeking equity financing.

Sunday, January 9, 2011

Merger Law Associates Ltd. - Frankfurt Exchange Chinese Companies Welcome

China is as of primary importance to The Frankfurt Stock Exchange and its parent company Deutsche Boerse, the largest exchange organization in the world. Deutsche Börse sees considerable growth and enormous potential in China. It is expanding its base in the region to capitalize on its existing business relationships and to build new business.

  • provide Chinese investors access to European products
  • give wide exposure of Chinese products to the European market place
  • help to develop domestic markets in China
  • benefit from the growth by collaborating with local players

The business generated by Deutsche Boerse in China has been increasing steadily for years and will continue to grow organically while Deutsche Boerse Group is simultaneously developing new opportunities in areas such as Listing Chinese Companies, Trading & Clearing, Custody & Settlement and Market Data & Analytics. Besides a number of Memorandums of Understanding (MOU) signed with various Chinese partners, Deutsche Boerse has also taken concrete steps in the following fields:

Chinese Company Listings

Deutsche Boerse and its subsidiary the Frankfurt Stock Exchange continue to strongly expand its relations with China in order to be an effective and reliable partner for Chinese companies. For example, it organizes capital market events and listing seminars in China in collaboration with its listing partners, and is expanding its listing partner network to include Chinese intermediaries and capital market participants.

The Frankfurt Stock Exchange listed the first Chinese company on its Open Market segment on March 30, 2007 and listed the first Chinese company on the Prime Standard segment of the Frankfurt Stock Exchange on July 6, 2007. Since then many more Chinese companies have chosen a primary listing on the Frankfurt Stock Exchange. There are more Chinese companies already in the pipeline for this year as well.

The XETRA® Trading Platform

Deutsche Börse’s own XETRA® electronic trading platform is widely known as the most efficient and flexible automated trading system for fully electronic securities trading in the world. China’s largest stock exchange, the Shanghai Stock Exchange, has licensed Deutsche Börse’s Xetra® electronic trading platform, which Accenture will adapt and implement specifically for the Chinese market. Xetra’s trading technology was chosen on the basis of its performance record of high scalability, speed, reliability, quality of core technology and the ease with which it can be adapted in other markets.

Clearing & Settlement

China Government Securities Depository Trust & Clearing Co. Ltd (CDC) has opened an omnibus account with Clearstream, which is owned by the Deutsche Börse Group. The qualified members of CDC are now able to settle and safe keep international securities via CDC’s account with Clearstream. The partners are discussing further cooperation in the field of collateral management.

Market Data & Analytics

Deutsche Börse and the China Securities Index Company (CSI), a joint venture between the Shanghai Stock Exchange and the Shenzhen Stock Exchange, signed a sales cooperation agreement on September 25, 2007. Under the terms of the agreement, Deutsche Börse acts as an exclusive sales partner for the CSI300 Index’s license of the ETF issuer in Europe.

Why the Frankfurt Stock Exchange?

For approximately ½ the cost of going public on the OTCBB, Chinese companies can go public on the Frankfurt Stock Exchange. Moreover, companies that trade on the Frankfurt Stock Exchange do not have to deal with the often criticized and overly burdensome requirements of Sarbanes-Oxley. This in itself is why many companies from all over the world are choosing the Frankfurt Exchange over the U.S. stock exchanges.

For these reasons and many more, the Frankfurt Stock Exchange listing is fast becoming the better choice for Chinese Companies that want to go public.

Monday, January 3, 2011

Going Public Through A Reverse Merger

Reverse Merger may be the quickest way to go public but is it the best? We look at a few drawbacks of using a reverse merger to take your company public.

For many business owners, the transition from a private company to a publicly-traded corporation is just out of reach.

An IPO is a daunting process, and the combination of limited resources and limited expertise can intimidate even the hardiest entrepreneurs. But what if there was a way to take your company public without the hassle and expense of an IPO?

The idea of circumventing the usual IPO process sounds like it should be illegal, unethical, or both. However a  reverse merger provides a shortcut that is both legal and logical. Although it may seem complicated, a reverse merger can be a lot easier than you think. Here's what you need to know:

What is a reverse merger?

In its simplest form, a reverse merger is when a smaller company takes over a larger one for the benefit of becoming a publicly-traded corporation. Usually, the publicly traded corporation is known as a "shell corporation" because it has little or no assets. Even though it continues to be a publicly traded corporation, its assets have evaporated through bankruptcy or liquidation and now all that remains is its internal structure and shareholders. The private company obtains the shell company by purchasing controlling interest through a new issue of stock.

Typically, the new, merged company will take the name of the private company, installing a new board of directors and corporate officers. At that point, the merged corporation files a few forms with securities regulators and works to maintain the minimum number of shareholders required for inclusion in stock exchanges.

The benefits of a reverse merger are fairly obvious. From the private company's perspective, a reverse merger eliminates the expense of an IPO as well as the time and hassle involved with making the transition to a public entity. The time factor should also be taken into consideration since a reverse merger will usually allow you to make the transition more quickly than an IPO.

Unfortunately there can be some drawbacks involved in using a reverse merger as a tool for taking your company public. The first may be the cost of the shell company itself. As more people have become aware of the benefits of reverse mergers, the cost of shell companies has risen sharply. It's possible that you could end up spending $300,000 or more in a reverse merger scenario and the owner of the shell company could retain a percentage of ownership in the new company.

Additionally,if the shell in a reverse merger is not new and clean it could involve the same risks you would incur in buying any business. Pending litigation, hidden debts, and inaccurate reporting can all come back to bite you if you fail to perform adequate due diligence. It is especially worthwhile to explore the reasons why the shell company went out of business in the first place. If the issues aren't resolved or haven't been explained to your satisfaction, you're probably better off moving on to another candidate.

Best is always getting a clean shell that has never traded. Merger Law Associates are specialists in creating clean shell companies.

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