On November 17, 2021, Pracuj.pl group, a leader in the digital recruitment market, operating in Poland, offering services to support the recruitment, retention and development of employees has published a prospectus with a view to conducting an initial public offering of the Company’s shares and their admission to trading on the main market of the Warsaw Stock Exchange. The offer covered up to 22,380,626 existing shares with each share having a nominal value of PLN 5 – representing 32.86% of the share capital. The maximum price has been set at PLN 82 per share.
Before the sale of shares takes place, the company conducts book-building, which is a key process in determining the share issue price. The book of demand thus involves the collection of non-binding information from potential institutional investors on their interest in acquiring the securities in question. The key stage affecting book building is the acceptance of subscriptions from potential investors, and on the basis of the interest in the offer the company determines the issue price and the final number of shares.
The method of subscribing to a share experiences differences depending on the category of investor – individual or institutional. In the case of an individual investor, the first requirement is to have a securities account open with the investment firm with which he intends to place such a subscription. Subsequently, subscriptions for shares must be made on subscription forms available at customer service points of investment firms, by fax, by telephone or by other electronic means. Retail Investors will place subscriptions at the maximum price, indicating the number of offered shares they intend to purchase.
As far as institutional investors are concerned, the entire subscription process starts once the book-building is completed. Then, after a discretionary selection by the responsible entities, invitations to subscribe are sent to investors, which entitle them to subscribe for a specific number of shares at a specific price. They are made in writing, on a special form made available by the relevant brokerage house.
However, the shareholder of the share thus acquired will not be the literal owner of the share, as this right accrues to the majority shareholder of the company upon completion of the offer, as this is a public offer of existing shares to which current shareholders are entitled. Nevertheless, shareholders have rights attached to their shares under the Companies Act and other laws. This matter may also be regulated by a special agreement entered into by the shareholders.
The prospectus is, in a sense, an offer made to potential investors, by outlining the financial benefits of the investment, is intended to encourage new shareholders to put their capital into the company. Taking Pracuj Group’s prospectus as an example, it presents the amounts of dividends paid in the past and the current dividend policy, which indicates that at least 50% of net profit will be distributed to shareholders. Moreover, a large part of the prospectus is devoted to the company’s financial results, its development plans and usually optimistic financial forecasts, which are supposed to convince as many investors as possible, that this is a profitable venture.
KIELTYKA GLADKOWSKI KG LEGAL advises on current basis individual and corporate investors at all stages of investment process in Poland, with a particular emphasis on cross border shareholding structures.
2. Prospekt Grupa Pracuj S.A., online: https://grupapracuj.pl/wp-content/uploads/2021/11/Prospekt-spolki-Grupa-Pracuj-SA.pdf .