Admission of shares to official listing in Spain

The process of admission to trading of a company's shares involves a strategic decision whose main purpose is to seek financing and distribute its risks, as well as to improve its brand image.

There are entrepreneurs who are not in favor of exposing their company to everyone because there is a risk of price manipulations and speculative attacks, in many cases, with conflicts of interest.

In addition, they are based on the theory that there are many more speculators than investors, being contrary to what a company seeks, which is to receive capital constantly over time (financing).

Admission to official listing

The admission to trading of a company must meet the following characteristics:

Previous requirements

• National values:
  • The minimum capital must be € 1,202,025. No shareholder can have a share greater than 25% of this capital. At the end of the placement, there must be at least 100 shareholders.
  • Obtaining sufficient benefits in the last two years of the company or three non-consecutive years out of a total of five, in order to be able to distribute dividends (payout) of at least 6% of the paid-up capital.

• Foreign securities:
  • The minimum capital must be € 1,202,025. No shareholder can have a share greater than 25% of this capital. At the end of the placement, there must be at least 100 shareholders.
  • Obtaining sufficient benefits in the last two years of the company or three non-consecutive years out of a total of five, in order to be able to distribute dividends of at least 6% of the paid-up capital.
  • Issuance of Audit Report for the last three fiscal years.
  • The Public Offer of Sale in the country of origin must be at least six million euros.
  • Its settlement must be included in the Spanish account annotations system.
  • Appointment of issuers, depositaries and buyers of the IPO.
  • All legal documents must be presented in the country of origin, accompanied by their sworn translation.

Placement

It is the most important phase, the advice of stock companies with a great reputation is advisable. In this phase, old shares can be placed in order to carry out divestments and new shares through capital increases with the entry of "stable" shareholders that coincide with the philosophy of the company.

The valuation of the shares for the placement must be carried out in a deep and meticulous way, taking into account the projection of results and the theoretical valuation of the company, analyzing companies in its sector and the economic situation. On the other hand, there is the option of setting different prices depending on the reward that you want to give to different investors.

Admission to trading

It consists, basically, in the presentation of legal documents before the National Securities Market Commission. Among them, the Informative Brochure stands out, where the most important characteristics are detailed.

Obligations to list on the Stock Exchange

Provision of Information:

It is mandatory to provide information periodically about the company in order that its price at all times is correct and transparent.

Costs:

In an IPO, advertising expenses are the most notorious. In addition, we can highlight the following:

• Management commission for the costs of securing the placement.
• Advertising expenses in order to attract a greater number of investors and enhance the image of the company.
• Exchange rates.
• Rates of the National Securities Market Commission and their Central Deposit.

Collaboration of professionals

Professionals with a lot of experience help prepare and adapt the company from the placement process and legal requirements or search for shareholders to the placement underwriting.