1.       Establish a Share Purchase Plan

The establishment of a share purchase plan provides a listed entity with an annual opportunity to raise additional funds without the expense of creating and providing a disclosure document. ASIC provides relief from the requirement to issue a disclosure document where a share purchase plan is established that meets specific conditions of class order 02/831 and the ASX listing rules.

The share purchase plan can be utilised once every 12 months to issue additional securities with a value of not more than $5000 to existing shareholders and negates the requirement to issue a disclosure document. Additional securities that are issued pursuant to a share purchase plan will fall within ASX listing rule 7.1 exemption 15, which means that a listed entity can preserve its ability to issue up to 15% of its issued capital without requiring shareholder approval.

2.       Clean up the Share Register

Share sale facilities can be an effective mechanism for 'cleaning up' a share register. A listed company with a large share register will often contain a number of s mall shareholders which, due to the size of their shareholding can be an administrative cost burden.

If a company's constitution permits the sale of nonmarketable share parcels or parcels that have a aggregate value of less than $1,000 then ASX market rule 16.4 permits the sale of these shareholdings.

A company implementing this strategy must provide shareholders with at least six weeks notice of the intended sale and shareholders are required to elect not to participate in the sale of their shareholding, which means that the company is able to affect the sale without obtaining shareholder approval.

The utilisation of this share sale facility provides a listed entity with an effective, low cost option for the management and organisation of its share register.

3.       Implement or Update the Corporate Governance Charter

The internal requirements of your company may require a ‘corporate deox’ and the implementation of or update to a corporate governance charter can not only assist in monitoring the economic efficiency of the company, but also increase shareholder confidence by instigating more transparent decision making.

Depending on the size and corporate structure of your company, the implementation of further policies and procedures such as a trading policy may be warranted. If your entity does not already have these policies in place maybe now is the time to implement them!

4.      Consider a Capital Raising

If your entity has a business plan for 2008 it is likely that additional capital will be required to ensure the business plan is a success. Raising additional capital can provide an entity with the necessary means to fund the future whether this involves working capital for growth, capital expenditure, a corporate restructure or future acquisitions.

Additional capital raising can be undertaken through a number of means including; IPO's, rights issue, Prospectus, Offer Information Statement and Information Memorandum's.
The capital raising option selected and its success is to a great extent dependent on understanding the objectives of the company and how these objectives can best be achieved. Assessment of the size, corporate structure and growth expectation of the business will be crucial in selecting the most appropriate capital raising vehicle for an entity.

Whilst an entity must strictly adhere to legislation when undertaking capital raising activities, the plethora of regulation that governs how a capital raising must be undertaken can often be easily navigated to meet future funding requirements.

5.       Think About an Initial Public Offering (IPO)

A company's potential can be optimised by offering its shares on an established stock exchange, such as, the ASX, AIM (in London) or TSX (in Canada). The advantage of an IPO is that it can provide a company with a significant volume of capital to enable it to realise its goals for 2008, elevate the value of company and increase the liquidity of the company's shares. An IPO is one option for obtaining access to capital but this in itself will take time, money and careful planning.

An established knowledge of the listing requirements together with an understanding of the company's objectives are essential in determining whether an IPO is the key to unlocking the company's future potential.

6.       Contemplate the Acquisition of a Target

Whether it is to achieve increased market share, business diversification, vertical integration or synergy, acquisitions are often a key component in the corporate strategy of a business seeking long term growth and increased profitability.

Irrespective of the size of the acquisition careful planning is required to ensure its success. Planning should always includes a series of due diligence investigations and valuations of the targets business.

7.       Consider a Corporate Restructure

An entity may have outgrown its corporate roots and it may be time to review the corporate structure to maximise growth and profitability throughout 2008.

A restructure may involve the implementation of a shareholders agreement, adoption of a new constitution, changing of corporate status, (for example from a proprietary limited company to a public company), or streamlining or enhancing the entity's assets. Each of these options can provide an entity with the ability to effectively progress the future needs of the business.

8.       Develop an Employee Share Option Plan (ESOP)

An effective way to incentivise employees whilst enhancing the growth of a company is to implement an ESOP. The establishment of an ESOP can encourage the growth of a company by offering to reward employees for their efforts with shares in the company.

The requirements of the ESOP will be driven by several factors including tax considerations, growth targets and legislative requirements but a carefully constructed ESOP can derive benefits for both the company and its employees.

Hopgood Ganim wishes you and your business every success in 2008 and we look forward to assisting you with your corporate New Year’s resolutions this year.

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