A “three-pronged” attack on different markets, including a joint IPO in Australia and Singapore, added to the complexity of Singapore Power’s $1.41 billion IPO of almost half its stake in SP AusNet.
The Australian gas and electricity distribution business made its debut on the Australian Stock Exchange on 14 December 2005, trading around the float price. Freehills acted for Singapore Power on the transaction.
The deal also included an offering to international institutions, including American institutions pursuant to the exemption provided by Rule 144A under the US Securities Act 1933.
“No one quite knew how it would go,” Freehills partner Robert Nicholson said. “But the demand Singapore Power was able to attract from all three markets was definitely worth the effort.”
He said the joint listing was intended to capitalise on Singapore’s rapidly growing equities market, which was proving to have “quite an appetite” for this type of stock. However, it did add to the complexity of the deal, necessitating compliance with three sets of legal standards.
The problem, Nicholson said, was reconciling Australia’s relatively new standard of keeping the prospectus clear, concise and effective and Singapore’s requirement for a reasonably large amount of prescriptive disclosure, when the company wanted the two documents to be as similar as possible.
The solution was a core document for both countries, with appendices added to the Singapore version to include the information not required in Australia and introductory sections consistent with market practice for the three types of offerings.
“At the same time, we had to comply with [Australia’s] pre-prospectus publicity rules,” Nicholson said. “We couldn’t lodge [the document] in Singapore in any way that would cause it to be published before it was lodged in Australia.”
To accommodate this, the document was lodged with the Monetary Authority of Singapore (MAS) on a preliminary basis. “The MAS has [the document] published as a draft prospectus on their website for two weeks before it is registered. So we lodged it with ASIC [Australian Securities and Investments Commission] and with MAS as a draft at the same time.”
Nicholson said the transaction was very interesting to work on. “There are some other stocks that are listed in both Australia and Singapore but none were a joint IPO,” he said.
Lawyers from Singapore firm Allen & Gledhill were involved in the Singapore offering and the Melbourne office of Sullivan & Cromwell worked on the international offering in compliance with Rule 144A.
For more information on the investment market in Singapore, turn to our new section The Asian Lawyer, on pages 22 and 23.