The Standard Market is a market of the Prague Stock Exchange designed for trading larger issues of shares of Czech and foreign companies. The Standard Market can accept either issues meeting the more demanding legal conditions of the official securities market or only the legal conditions of the regulated market. The Exchange also allows the admission of shares without the issuer's consent if the issues are already traded on another regulated market within the EU.
The Start Market may be more suitable for trading shares issued by smaller companies and the Prime Market may be more suitable for large international corporations.
- the possibility to trade subscription rights
- SPAC
- legal form of a public limited company or European company (SE), or similar legal form under foreign law
- book-entry of shares in a domestic or foreign central depository
- the transferability of the shares accepted must not be restricted in any way
- the prospectus of the security is published before admission to the market
- a sufficient proportion of the accepted issue is owned by the investing public
- comply with the legal reporting requirements of International Financial Reporting Standards (IFRS)
In the case of the legal rules of the official market, firms must meet the following legal criteria, among others:
- a market capitalisation of the issue of EUR 1 000 000
- the part of the issue that is dispersed among the public (free-float), at least 25%
- the duration of the issuer's existence of at least 3 years
- application for admission and signed framework agreement between the issuer and the exchange
- the prospectus of the security
- proof of the allocation of the ISIN or similar identification code and proof of registration of the issue by the central depository
- an extract from the commercial register or similar foreign register
- the memorandum and articles of association or articles of association of the issuer or an equivalent document under the law of the issuer's home state
- if the issue is governed by the legal conditions of the official market, also the annual accounts for the last 3 years
Samples of applications, contracts and other relevant documents will be provided by the Exchange upon request. Previously published prospectuses are archived in the register of the relevant regulator.
The Chief Executive Officer shall decide on the acceptance of the share issue within 10 days of receipt of the application.
A company may enter the Standard Market by way of an Initial Public Offering ("IPO"). The entire transaction is arranged and managed by an "Issue Manager", an experienced external qualified adviser engaged by the company. The service also includes communication with investors and the provision of an order book, which is a system for collecting instructions from individual investors. Once the public offering is completed, the issue manager, in cooperation with the issuer, determines the subscription price. The transaction may also include an over-allotment option, the green shoe option, which allows the transaction manager to subscribe for additional shares and provide additional price stability for the shares after the subscription.
A lock-up period, i.e. a ban on the sale of shares of major shareholders within a predetermined period after the IPO, can also be used to stabilise the price.
Alternatively, a company may enter the Standard Market through a direct listing. The company does not hire a transaction manager and does not set the price of the listing. Existing shareholders sell their shares already on the stock exchange. The opening share price is set in the first open introductory auction. Price stabilization tools are not used.
After the initial public offering, the IPO, is completed, the subscription will be settled by the central depository. This means that the new shareholders will receive their shares and the company will receive the funds. At the same time, existing shareholders who decide to sell their shares in the IPO will also receive funds. Settlement will take place at the same time and the issuer's shares will start trading on the stock exchange the following business day.
The Company is obliged to publish on its website and at the same time send various documents and information via the electronic stock exchange application. For example:
- the audited annual report or consolidated annual report within 4 months after the end of each financial year
- the half-yearly report within 3 months after the end of the first 6 months of each financial year
- the invitation to the general meeting and the minutes of the general meeting
- information on changes to the company's articles of association
- information on changes in the number of shares in issue, nominal value, etc.
- information that may cause a significant change in the share price
The issuer must comply with the information obligations outside trading hours. The above points are not an exhaustive list of obligations.
Detailed information is set out in the Standard Market Rules.
Issuers do not pay any fees to the exchange upon admission to the Standard Market and in the first year of trading. In subsequent years, they pay an annual fee of CZK 10,000 for trading the issue.
Detailed information is set out in the Fee Schedule.
This is another way to go public, where a company that is already operating can merge with SPAC, becoming a listed company on the stock exchange and raising additional capital at the same time.
A Special Purpose Acquisition Company (SPAC) is a type of investment company. It is a publicly traded shell company or blank check company that is formed for the sole purpose of raising capital to acquire one or more private companies. Investors must largely trust the SPAC's management team to find the best target company for the merger.
