Conditions and records of the company after the process of restructuring the enterprise that wants to offer securities to the public are regulated according to Vietnamese law

What is a public company?

According to the provisions of Clause 1, Article 32 of the Securities Law 2019, a public company is a joint stock company in one of the following two cases here:

– The company has a contributed charter capital of VND 30 billion or more and has at least 10% of voting shares held by at least 100 investors who are not major shareholders;

– The company has successfully conducted an initial public offering of shares through registration with the State Securities Commission.

What conditions must be met when a public company wants to offer securities to the public after restructuring?

According to the provisions of Article 30 of Decree 155/2020/ND-CP, the conditions for a public company after the restructuring process to offer additional shares to the public, convertible bonds, bonds with warrants to the public; Companies after the restructuring process offer bonds to the public including:

– Meets the corresponding conditions for offering stocks and bonds to the public, including the conditions of profitable business operations and no accumulated losses of the company.

– Business activities of the year immediately preceding the year of registration for offering must be profitable and at the same time have no accumulated losses up to the year of registration for offering based on:

+ In case the company registers to offer for sale in the year of corporate restructuring: the financial information summary report according to the convention of the year immediately preceding the year of restructuring of the issuing organization is guaranteed by an approved auditing organization with full acceptance; The issuer’s most recent quarterly financial report;

+ In case the company registers to offer in the year immediately following the year of restructuring (in case of consolidation):

(1) Report summarizing conventional financial information for the last annual accounting period before the time of restructuring of the issuer guaranteed by an approved auditing organization with an unqualified opinion;

(2) The issuer’s financial statements for the first annual accounting period after restructuring are audited by an approved auditing organization;

(3) Most recent quarterly financial statements of the issuing organization (if any). Conditions for profitable business operations are determined based on the total profit after tax on the financial information summary report according to the convention of the last annual accounting period and on the financial report of the first annual accounting period;

– In case the company registers to offer from the year immediately following the year of restructuring onwards (in case of merger, business acquisition, sale of assets), the company registers to offer from the second year after the year of restructuring onwards (in case of consolidation): the most recent year’s financial statements audited by an approved auditing organization, the most recent quarterly financial statements (if any) of the issuing organization.

If a public company after the business restructuring process wants to register to offer securities to the public, how do they need to prepare documents?

According to the provisions of Article 31 of Decree 155/2020/ND-CP, the registration dossier for a company’s public offering of securities after the process of corporate restructuring in separate cases is prescribed as follows:

– In case the company registers for an offering in the year of restructuring: the offering registration dossier is in accordance with the corresponding regulations on the registration dossier for offering additional shares to the public, the offering of convertible bonds, bonds with warrants to the public of public companies, and the registration dossier for public offering of bonds, in which the annual financial statements audited by an approved auditing organization of the 02 years preceding the year of registration for offering are replaced by the following reports:

+ Annual financial statements audited by an approved auditing organization of enterprises participating in restructuring of the 02 years preceding the year of restructuring;

+ Report summarizing financial information according to the convention of the previous year immediately preceding the year of restructuring guaranteed by an approved auditing organization of the issuing organization;

+ Financial statements of the last accounting period before the time of restructuring of the enterprises participating in the restructuring (in case of consolidation).

– In case the company registers to offer in the year immediately following the year of restructuring: the registration dossier for the offering shall comply with the corresponding regulations on the registration dossier for offering additional shares to the public, the offering of convertible bonds, bonds with warrants to the public of public companies, and the registration dossier for offering bonds to the public, in which the annual financial statements audited by an approved auditing organization of the 02 years preceding the year of registration for the offering are replaced by the following reports:

+ Financial statements for the first annual accounting period after the time of restructuring of the issuing organization are audited by an approved auditing organization and a summary report of conventional financial information for the last accounting period before the time of restructuring of the issuing organization is guaranteed by an approved auditing organization (in case of consolidation);

+ The restructured annual financial statements are audited by an approved auditing organization of the issuing organization (in case of merger, business acquisition, or asset sale);

+ The financial statements of the previous year immediately preceding the year of restructuring are audited by an approved auditing organization of the enterprises participating in the restructuring.

– In case the company registers to offer for sale in the second year immediately following the year of restructuring (in case of consolidation), the registration dossier for offering includes:

+ Offering registration dossier according to the corresponding regulations on registration dossiers for offering additional shares to the public, offering convertible bonds, bonds with warrants to the public of public companies, and dossiers for registering public offering of bonds, in which the financial statements of the second year immediately preceding the year of offering registration are replaced by the following reports:

(1) The issuer’s financial statements for the first annual accounting period after restructuring are audited by an approved auditing organization;

(2) The financial statements of the last accounting period before the time of restructuring are audited by an approved auditing organization of the enterprises participating in the restructuring;

+ Audited financial statements of the previous year immediately preceding the year of restructuring of enterprises participating in the restructuring.

– In case the company registers to offer from the second year after the year of restructuring (in case of merger, business acquisition, asset sale), registers to offer from the third year after the year of restructuring (in case of consolidation): the offering registration dossier follows the corresponding regulations on dossier to register to offer additional shares to the public, offering of convertible bonds, bonds with warrants to the public of public companies, and dossier to register to sell bonds to the public.

Thus, above is some information about the conditions for public securities offering for public companies after the process of corporate restructuring and documents to register such offering.