Primary Listing on the Frankfurt Stock Exchange and Xetra
The Frankfurt Stock Exchange, the world’s ‘International Stock Exchange’ is the 3rd largest exchange group in the world, with over 86% of the market as international companies! FSE Listings Inc specializes in listing foreign companies onto the Frankfurt Stock Exchange.
The Frankfurt Stock Exchange (Deutsche Börse) offers access to both the Regulated Market and the Regulated Unofficial Market (Open Market). The Regulated Unofficial Market is also referred to as the exchange regulated market which is regulated only by the Frankfurt Stock Exchange itself. Within the regulated market and the regulated unofficial market, there are four listing segments which serve the different needs of issuers and investors. The four segments beginning with the segment with the simplest requirements are as follows:
Regulated Unofficial Markets (exchange regulated and governed by private law):
1. First Quotation Board
2. Entry Standard
EU Regulated Markets (based on the European Union transparency standards):
3. General Standard
4. Prime Standard
XETRA is widely known as the most efficient and flexible automated trading system for fully electronic securities trading in the world enabling cross-border trading for international investors. Below you will find some of the benefits of a listing on the Open Market segment of the Frankfurt Stock Exchange and XETRA as an alternative to the OTCBB or other U.S. stock exchanges:
Why list on the Frankfurt Stock Exchange, and why is it superior to the South African, Canadian, London-UK and US alternatives?
- The Frankfurt Stock Exchange is the world’s third largest trading center for securities and Germany’s largest exchange.
- German investors, both institutional and private, who have held back from investing for many years by government restraints and their own conservatism, are now actively searching for small to mid-size foreign companies to invest in.
- Europeans like to invest historically in projects that are in foreign jurisdictions
- The German Frankfurt Exchange has a primary market consisting of more than 100 million people, and has the fastest rate of growth and the highest income per head in the EU.
- 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. Compared to the listing on other exchanges, such as the NASDAQ, OTC Bulletin Board, Canadian Venture Exchange (TSX) or the Alternative Investment Market (AIM) in London, Frankfurt stands out because of the ease of entry, (Audited financials are not required), fast process and low annual fees.
- Today, with a total turnover of €5.2 trillion per year the Frankfurt Stock Exchange strengthens its position as the world’s 3rd largest trade-place for stocks and the world’s 2nd largest by market capitalization.
Qualifying Companies
To qualify, a company must meet the following basic criteria:
- At least one year in existence.
- Privately owned (this is not a dual-listing for existing public companies, but is an IPO)
- Can be domiciled anywhere in the world.
- Good financial statements in International or U.S. GAAP format (but do NOT need to be audited)
- At least 30 shareholders (if necessary, owners can gift small numbers of shares to family and friends to insure this minimum number)
- A minimum of 250,000 Euros has been invested in the company (Paid-up capital)
Shares to be listed
Up to 100% of the owners’ shares will be “registered” and become free trading and listed on the
Exchange, but these shares may be subject to a “lock up” agreement for a determined period of time to permit the financing to take place first.
Company Valuation
A company can expect a substantially higher public market valuation than would be attributed to it as a private concern. For example, private companies are typically valued at a multiple of 3 to 5 times EBIT, whereas this same company, in a public market with liquidity of its stock, would have valuation of 15 to 20 or more times EBIT and even development stage companies with no revenue or profits often have very high valuations as public companies.
Time for Listing/Trading
Typically, once due diligence information has been fully delivered by the Company, the entire process takes 4-6 weeks to complete the listing and to commence trading.
Raising Capital; Investor Road Show
Once trading commences, the Company will be taken on an extensive road show across Germany and Switzerland to expose the financing to appropriate groups with the expectation to secure funding commitments within one to two weeks. The investor groups will buy new stock at a negotiated discount to the market price. The cost of the road show is included in FSEListings.com’s fee, except for the travel and accommodation expenses of the representatives of the Company. Also, you can expect an industry typical success fee payable upon funding.
Multi City Show: Cities may include: Zurich, Munich, Frankfurt, Düsseldorf, Berlin, Dubai and Abu Dhabi.
Face to face meetings with funding groups and strategic investors, arranged to generate substantial interest for the Company’s stock in major European equity markets.
Maximized results by handpicking the parties for each presentation to ensure the best possible fit between the attendees and the Company.
Why FSE Listings Inc?
We are a European IR consulting firm that provides financial related services to both public and private corporations. Since 2000, we have been offering our American, Australian, Chinese, Canadian and British clients a wide range of financial services and creative IR strategies throughout Europe. These services include:
- Primary- and dual-listings of the Company’s shares on European stock exchanges such as Frankfurt, the AIM (Alternative Investment Market) or Plus Markets (London).
- Structuring and implementing comprehensive IR/PR campaigns designed to maximize the dissemination of corporate information to potential retail investors in Europe – predominantly in Germany.
- Assisting Companies in raising capital and expanding their institutional base in the major European financial communities.
- An effective way of achieving a higher market-cap and additional sponsorship for your corporation is via a Cross-Border Listing (dual listing) – i.e. PLUS Markets and a European Stock Exchange.
- We have the expertise to assist you with all of the applications and filing requirements to have your company approved for trading within a couple of weeks after the first applications are in and we select the local German specialist firm to sponsor your daily trading and settlements.
The benefits to your company from listing on Frankfurt are:
- Increased international exposure.
- Ability to raise equity capital in Europe.
- Enhanced shareholder value.
- Increased Market-Making commitments.
Initial Frankfurt Stock Exchange Listing Package € 60,000 includes:
- Initial consultation and application for the Frankfurt Stock Listing
- Press release announcing your company’s Frankfurt Stock Exchange approval
- Specialist setup & maintaining of the electronic Order Book on your company’s shares
- Issuance of an ISIN number.
- Routing and processing of bid and ask orders
- Clearing and tracking of the electronic register
- Real-time quotes with Worldwide access from all European financial portals (in Java)
- Monitoring of new threads of leading Financial Community Message Boards in Europe including Comdirect.de, Wallstreet-online.de, CortalConsors.de, financial.de, etc.
- Once your company is approved for trading it will enable you to increase investor awareness across the EU resulting in the ability to raise additional funds through equity sales.
Next Steps: Contact us at info@fselistings.com
We would be pleased to schedule a conference call with one of our senior partners in Europe to answer any questions or concerns that you may have and discuss costs and procedures.
- Primary- and dual-listings of the Company’s shares on European stock exchanges such as Frankfurt, the AIM (Alternative Investment Market) or Plus Markets (London).
- Structuring and implementing comprehensive IR/PR campaigns designed to maximize the dissemination of corporate information to potential retail investors in Europe – predominantly in Germany.
- Assisting Companies in raising capital and expanding their institutional base in the major European financial communities.
- An effective way of achieving a higher market-cap and additional sponsorship for your corporation is via a Cross-Border Listing (dual listing) – i.e. PLUS Markets and a European Stock Exchange.
- We have the expertise to assist you with all of the applications and filing requirements to have your company approved for trading within a couple of weeks after the first applications are in and we select the local German specialist firm to sponsor your daily trading and settlements.
FSE Listings Inc, Your Only Frankfurt Stock Exchange Listing Partner
FSE Listings Inc recently listed 3 companies in a one month period, the clients who listed where both shocked and relieved to have trusted our firm to take them public. Especially one of our clients who entrusted his first attempt of going public with another go public firm in Germany that didn’t meet the critical required elements that FSE Listings can as your listings partner. Our costs and process is transparent and built on over 12 years of experience in the field of listing companies.
We know of no other company that can accomplish a Primary Frankfurt Stock Exchange listings for foreign corporations.
Our firm specializes in:
– Listing UK, Asian, US, Canadian, Australian, Indian, and non-Eu Companies on the Frankfurt Stock Exchange successfully within 3-6 weeks
– Our team have been partners of the Frankfurt Stock Exchange and have listed over 1500+ companies within their respective market maker businesses
– We deal directly with the sources of services and have a long standing relationship which allows for your information to be delivered in the right format and become listed faster and more efficiently
– Our listings services are affordable and payment does not have to be made until after the listing is complete. We know of NO OTHER Listing Consultant that offers this service
– Our partners are the leading certified Deutsche Börse brokers, listing partners, paying agent, banks, and registrars with the ability to get pre-approvals from the Frankfurt Stock Exchange. (We often discuss matters directly with the exchange.)
– All of the companies we have listed managed to obtain the desired market cap of their company upon listing to assist in their capital raising process
– All of the companies we have worked with have found financing options on the Frankfurt Stock Exchange or due to their listings
– All of our listings include the XETRA electronic trading platform
– Our firm has developed relationships with the top Germany-based IR/PR groups who can help your company gain marketshare and exposure on the Frankfurt Stock Exchange
Contact Us
(Primary Listing) is the best way to Go Public
You do not need another consultant or individual to discuss with you how to list when we can do it all for you. The reality is that our firm can perform a free Initial consultation and qualify your firm for application for the Frankfurt Stock Listing. Complete the application and all required documents and information. Incorporate the company if required and assist with all of the documentation for capitalization, legal opinions, and shareholders. Specialist setup & maintaining of the electronic Order Book on your company’s shares. Issuance of an ISIN number. Routing and processing of bid and ask orders. Clearing and tracking of the electronic register. Once your company is approved for trading it will enable you to increase investor awareness across the EU resulting in the ability to raise additional funds through equity sales.
List of Required Documents and Information
- Certificate of Incorporation
- Memorandum
- Articles of Association
- Number of shares outstanding (as per incorporation documents) and par-value per share (also as per incorporation documents)
- Certified Copies of ID’s of the directors and supporting documents (please look at appendix A)
- Business Plan
- Financials (Opening Balance Sheet etc)
- Letter from Auditor with regards to paid in capital or a Solicitor who is holding the funds
- Letter from the CEO Certifying the paid in capital and number of shareholders within the company
- ISIN documentation completed and applied for by FSE Listings Inc
Second Step Documents
- Frankfurt Application Document Signed with above documents.
- Engagement Letter with the Registrar for Electronic Trading within your jurisdiction, For example CREST
- Upon receipt of registration details create the register of members of ordinary shareholders.
- Produce and issue the initial ordinary share certificates of entitlement.
- Liaise with Euroclear UK & Ireland Limited (“EUI”) to ensure all procedures and documentation is in place to enable CREST eligibility of the issued ordinary shares.
- Issue for signing and return by your firm both the CREST Security Application Form and CREST Enablement Letter.
- Submit to EUI both the signed CREST Security Application Form and CREST Enablement Letter.
Secondly, ensure you have a consultant from FSE Listings Inc who can perform the following tasks with the documentation supplied:
Consulting Services:
- Initial due diligence
- Prepare and coordinate drafting of a Company securities prospectus/expose for admission to the Frankfurt Stock Exchange for IPO
- Liaising with company management for all due diligence documentation required in respect of the IPO listing
- Preparation of all other documents required for admission to trading and commencement of trading on the Frankfurt Stock Exchange
- Appoint and work with Share Registrar of Company to have shares registered
- Activate electronic share registration system with Share Registrar and share clearing system in Germany
- Joint presentation of the application for the listing of new shares for IPO by Company
- Liaison with Frankfurt Stock Exchange
- Drafting and coordinating publication of any mandatory announcements
- Application for the start of trading on the Frankfurt Stock Exchange for the Company’s IPO.
- Assist in transfer of shares via CREST/CLEARSTREAM into the electronic trading system.
Services include the cost of the Sponsor, Listing, Filings, Incorporation, and documentation preparation.
CONTACT Info@FSEListings.com
Reverse Mergers and Frankfurt Public Shells
On occasion FSE Listings Inc has the ability to perform reverse mergers into public shells that projects have dematerialized or have 100% Frankfurt Shell Companies for Sale. Shell companies are often used when companies are in a hurry to go public, and/or they do not have the required number of shareholders to go public or capital in requirements of 250,000 euro.
When you list via a reverse merger, the private companies is merged into the public company taking over control of the vehicle. The private company is then public within the new company of which is has control. In the event of purchasing a Frankfurt stock exchange shell company, the private company merges at the same time that all of the shares are privately purchased within the company giving complete control to the private company shareholders. The listing on the Frankfurt Open Market is relatively quick, 3-6 weeks, and therefore, many people decide not to purchase a Frankfurt Shell but rather to list directly. However, we do have an inventory of Frankfurt Shells at www.frankfurtshell.com.
In many cases, the assets of pre-existing US-NASDAQ, AIM, TSX, and JSE companies are spun-out or made into a spin-off that is put into the new company that is the Open Market Frankfurt Stock Exchange listed company. In this case, the listed company is the Frankfurt Shell company, and the asset is merged into the firm taking over control. The transfer of control is where the term “reverse merger” is used to describe this process. The Frankfurt Shell companies we represent have no liabilities, often their assets are spun-out or in default and no longer exist within the company, and completion of the acquisition can be done within one week of proof of funds.
For trading Frankfurt Shells go to www.frankfurtshell.com
Why The Frankfurt Stock Exchange
In an international comparison, the Deutsche Börse (Frankfurt Stock Exchange) remains the most attractive listing venue for companies aiming for an IPO. Current studies compare the world’s primary market activities and terms for listing on the Frankfurt Stock Exchange to the leading international exchanges. The study analyzes terms for IPOs on the Frankfurt Stock Exchange and compares them with the stock exchanges Euronext, Hong Kong Stock Exchange (HKSE), London Stock Exchange (LSE), NASDAQ und New York Stock Exchange (NYSE). Almost every third listing of a company, which chose Deutsche Börse as a listing venue, was an Initial Public offering (IPO). This includes a first public offering of shares with an approved prospectus. Only 0.3 percent of all listed companies on the Alternative Investment Market (AIM) in London had an IPO at this venue. Sector focus is key to selecting a listing venue for an IPO – especially for companies from the emerging markets. The Deutsche Börse leads among companies whose business is in the alternative energies, high technology, chemical and industrial sectors. In alternative energies alone, 97.8 percent of the entire placed IPO volume has been placed on the Frankfurt Stock Exchange. Another key criterion is the durability of a stock exchange listing.
Deutsche Börse clearly stands out in this respect:
No company with an IPO in Frankfurt between January 2001 and March 2008 has become insolvent. The percentage of insolvencies for Euronext is nearly three percent and for LSE more than five percent. The proportion of delistings is also correspondingly high. The percentage of delistings on LSE is more than ten percent, while at Euronext it is almost seven percent, with no delistings from HKSE or rnrnFrankfurt Stock Exchange during the period stated. For the period from January 1999 to March 2008, Deutsche Börse received top marks as a listing venue in a global comparison. Companies benefit from the lowest capital costs and the highest liquidity. Subjects of the examination included the costs of market access, the subsequent costs for further capital increases and liquidity. Deutsche Börse’s Prime Standard and General Standard rank above the other “main markets”, with its Entry Standard also ranking above other alternative markets.
Today, with a total turnover of €5.2 trillion per year the Frankfurt Stock Exchange strengthens its position as the world’s 3rd largest trade-place for stocks and the world’s 2nd largest by market capitalization.
The city of Frankfurt has the unique distinction of being host to one of the first stock exchanges in the world. Owned and operated by Deutsche Borse, the Frankfurt Stock Exchange is the third largest trade-place for stocks in the world and the second largest in terms of market capitalization. There are currently about 6823 companies quoted on the Frankfurt Stock Exchange and the exchange enjoys an annual turnover of roughly 5.2 trillion euros. Most of the FSE’s trading takes place via a fully electronic trading system known as Xetra. This electronic system makes it possible for 15 different countries to trade on a single platform. Because this allows for countries to trade on the exchange without actually being in the country for floor trading, some 47% of those companies trading on the FSE are located in other countries. Those companies wishing to enter the Frankfurt stock market can choose from three different categories: Prime, General and Entry Standard. Entry Standard is of course, the easiest ways since Prime and General are regulated by the EU rules. Some examples of companies listed on the Frankfurt Stock Exchange are Nokia, Opel, Porsche, Daimler Chrysler and Hugo Boss Ag.
Germany enjoys one of the most highly developed market economies in the world and it is the largest economy in Europe. It also ranks fifth in the world in terms of purchasing power parity and GDP. The country’s economy is largely export-orientated and exports account for more than one-third of the country’s annual output. However, despite the fact that Germany enjoys such a high export rate, it suffers from low consumer confidence on a local scale. This has weakened the local economy somewhat, but he government is making strides towards alleviating the problem. Currently the services sector contributes the most towards Germany’s GDP with roughly 70.3% of profits coming from this sector. Agriculture in Germany is incredibly small with only 1.1% of the country’s revenue being generated by this sector and the remaining 28.6% coming from the industry sector. About 13% of the country’s population live below the poverty line and some 9.6% are unemployed. While these number are not all that good for a developed country, they are not that bad when compared to other countries.
Germany’s main industries are iron, steel, cement, coal, chemicals, machinery, motor vehicles, machine tools, electronics, food, beverages, shipbuilding and textiles. In 2005 $1.016 trillion was generated from exports while only $801 billion came from imports. This further shows how much more is generated from exports each year. The country’s main trade partners are France, the US and UK, Italy, the Netherlands, Austria, Belgium, Spain, Switzerland and China.
Why are companies actively seeking consultants for a public listing on the Frankfurt Stock Exchange (FSE) is because of the ability to raise from 2 to 15+ million Euros immediately thereafter from European pension funds, hedge funds, selling groups and private investors.
The total amount that can be raised will be based on the valuation of the Company. The financing occurs very quickly after trading commences on the Exchange. European private and institutional funds are actively seeking investments in newly listed public companies, and the process is rapid as compared to other Designated Offshore Exchange (DOE) venues.
A Frankfurt exchange listing is the first step on the road to becoming a public company, with the opportunity to dual-list in the future, either in the U.S. or Dubai.
The Benefits
There are numerous benefits to a Frankfurt Exchange listing:
– Increased trading volume and market capitalization,
– Addition of new shareholders,
– Capital raising opportunities,
– Raise brand or services awareness,
– No restrictions on insider sales,
– Becoming a truly global player,
– Sometimes only 4 – 6 weeks from application to approval for trading,
– Low cost to value realized and low annual fees.
In addition, further fundraising is possible through the listing, depending on valuation level of the client company.
Contact info@fselistings.com
