Once again Renell Bank participates in the Trading Charity Day of the Frankfurt Stock Exchange.
On 6 December 2018, Deutsche Börse AG and the Specialists active at the Frankfurt Floor will donate the transaction and trading fees received from shares, bonds, funds, ETFs and exchange-traded products (ETCs and ETNs) on the Frankfurt Stock Exchange trading venue on that day.
Through the “Trading Charity – trade and help” initiative, Deutsche Börse AG and the companies acting as Specialists will support four local charities: “KinderPalliativTeam Südhessen”, “Leben mit Demenz e.V.”, “Frankfurter Verein zur Unterstützung von psychisch kranken Kindern und Jugendlichen e.V.” and “MainLichtblick e.V.”.
Just recently, on April 3rd, Spotify did it: a stock market listing without issuing new securities and thus (almost) without the use of expensive investment banks; frankly spotify raised some funds before in a private placement round. However, this type of Going Public is also called IPO-light or direct listing.
Usually, investment banks determine the value of the company and the related issue price of the (new) shares ahead of a planned IPO. These shares will then be offered to interested investors as part of a roadshow. The investment bank receives a proportionate placement fee for this work, which is often around 3%.
A direct listing eliminates all this. Only a part of existing shares are offered for sale on the stock exchange. New capital is not necessarily flowing to the company. The price is determined by an auction procedure on the stock exchange. Most of the time higher prices can be achieved.
This form of Going Public was also seen in Germany, Evonik went live in a similar manner – a technical listing with previous private placements where the major Investors sold part of their holding.
In addition to a law firm that is filing the stock exchange prospectus, essentially only one securities trading bank is required, as a link to the stock exchange to act as applicant and finally the market making for the shares. This is a considerable reduction of costs and overall resources. Renell Bank as securities trading bank and member to several stock exchanges and has accompanied several technical stock market listing in recent years.