TL;DR
Executing an EO involves several key steps: determining offer details, preparing regulatory documents, announcing the offer, opening it for a set period, managing rights trading (for renounceable offers), closing the offer and allocating shares, issuing shares, updating the share registry, and announcing the results and closure.
Table of contents
Deciding on size, pricing and timing.
Decide on the ratio of entitlement, pricing, and total capital to be raised. For renounceable offers, shareholders can sell their rights; in non-renounceable offers, rights cannot be sold.
Preparing regulatory and legal documents.
Develop offer documents, including a prospectus or offer information statement, ensuring compliance with ASX Listing Rules and other regulations.
Announcing the entitlement offer.
Officially announce the entitlement offer to the market, providing detailed terms and information to shareholders.
Launching the entitlement offer.
Open the offer for a set period, typically 3-4 weeks, allowing shareholders to exercise their rights.
Managing rights trading (renounceable only).
If the offer is renounceable, facilitate the trading of rights on the ASX, enabling shareholders to sell and trade their entitlements.
Closing the offer and allocating shares.
After closing the offer, process applications and allocate shares. Handle surplus shares in case of undersubscription, with potential underwriting considerations, especially for non-renounceable offers.
Updating the share registry and issuing shares.
Issue new shares to participating shareholders and update the share registry to reflect the new holdings.
Announcing results and closing the offer.
Publicly announce the outcome of the offer, including the amount of capital raised and the number of shares issued.
Executing an entitlement offer can be a little more complex in terms of the offer documents and disclosures required but the benefits of proportionate shareholder inclusion and minimised dilution are significant. You can pair an entitlement offer with a placement to target new investors and include your existing shareholders at the same time.