The Securities and Commodities Authority has stated that Federal Law No. (2) of 2015 regarding commercial companies allows companies with limited liability and family companies wishing to list their shares in the financial markets, to convert first to private joint stock companies in accordance with the procedures of the Ministry of Economy, and thus can later list in The financial market in this case.
And it showed in an awareness bulletin, "Emirates Today" obtained a copy of it, that if family and limited liability companies after their transformation into a private joint stock company wanted to sell a percentage of their shares in a public offering, to turn into public joint stock companies, then they can do so also provided that A period of not less than two years since the incorporation of the company, and achieving a net operating profit that can be distributed to the shareholders, an average of not less than 10% of the company’s capital during the previous two fiscal years to agree to the transfer request.
She explained that the legislation allows companies to transform into a private joint stock company and list their shares in the financial markets at a time that suits them without selling their shares in a public offering, and also allows them to sell their shares in a public offering when converting to a public joint stock company when they wish to do so.
According to the prospectus, the company passes during the transformation into a public joint stock company in three basic stages:
1- Pre-subscription stage, which includes:
- The approval of the partners to take a decision to convert into a public joint stock company.
- Appointing the financial advisor and legal advisor for the offering process to prepare the necessary studies and reports, including (the company's future business plan, the company's evaluation study and the public offering).
Preparing the transformation plan and structuring the offering process.
Fulfillment of documents, documents and undertakings to be attached with the request for transformation.
Submit the transfer request to both the competent local authority and the authority.
Obtain final approval and start advertising and promotional activities.
2- The IPO stage, in which:
Announcement of a prospectus for public offering.
- Determine the final subscription price through the process of building orders.
Announcing the final subscription price in two daily newspapers.
Close the subscription, allocation and refund of surplus funds.
3- The listing and trading stage, which includes:
- Holding the first constituent assembly of the new public joint stock company.
Registration of the new public joint stock company with the authority.
Listing and trading on the stock market.
In the event that all requirements are met, the time taken for the public offering process, conversion to a public joint stock company, and listing in the financial markets does not usually exceed three months.
The Securities and Commodities Authority confirmed, in its publication, that after completing the company's transformation into a public shareholding and listing it in the financial market, it must observe a commitment to prepare interim and annual financial statements, in accordance with international accounting standards, and independent audit of these lists in accordance with international auditing standards through an accredited auditor The Authority has, compliance with the disclosure and transparency rules and corporate governance controls established by the Authority, holding the annual general assembly of shareholders, and making dividends in accordance with the requirements of the companies law, the procedures of the body and the company's articles of association, and what the annual general assembly decides for them, as well as including the organizational structure of the company as an employee involved in relationships Investors, or appoint a body licensed by the authority to do that job.