Financial Management Australia Analysis 2022

Running head: FINANCIAL MANAGEMENT
Financial Management
Name of the Student:
Name of the University:
Authors Note:

FINANCIAL MANAGEMENT
1
Table of Contents
Introduction:...............................................................................................................................2
a. Evaluating the measures that were taken by the three companies for initiating the initial
public offerings:.........................................................................................................................2
b. Understanding the cost of equity that is conducted for long term finance:...........................4
c. Analysing and authenticating the impact of under-pricing in a capital market:....................5
d. Understanding the Australian IPO activity:...........................................................................6
e. Understanding the returns provided by IPO without dividends:............................................8
f. Understanding the returns provided by IPO with dividends:.................................................9
Conclusion:..............................................................................................................................10
References:...............................................................................................................................11

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Introduction:
Initial public offerings are considered to be one of the essential components or
technique, which is used by the organisation for adequately acquiring the required level of
funds from the capital market. This technique is used for generating the required level of
funds for supporting further activities and increases their financial capability in the long run.
The information regarding the cost of equity that has changed after the initial public offerings
are also discussed which helps in detecting the level of minimum returns that need to be
provided by organisation after their IPO. The significance and problems that was associated
with the under-pricing measure are adequately conducted to detect its impact on the
Australian capital market. Furthermost, the IPO activities are evaluated and compared with
the Australian capital market to understand its relationship. Lastly, the performance of the
IPOs is mainly compared with the ALL Ordinary Index to detect the level income that would
be enjoyed by investors if they tend to support investments during the Initial public offerings.
a. Evaluating the measures that were taken by the three companies for initiating the
initial public offerings:
Name of
the
company Industry
IPO
Date
Fund
intended
to raise
Fund
raised Main fund purpose
National
Storage
Real
Estate Dec-13 $240m $240m
The aim of the fund offer
was to support the issue of
new stapled securities, where
transfer of existing stapled
securities. The proceeds from
the IPO can be used for
Cash-Out facilities and
strengthened the financial
performance of the
organization.
Sandon
Capital
Investment
Diversifie
d financial Dec-13 $100m $100m
The investment scope will
eventually provide activist
investment strategy, which

FINANCIAL MANAGEMENT
3
s
would help in improving
their investment capacity. In
addition, the IPO would help
in delivering absolute
positive return over the
medium and long term
growth. The company aims
in generating high level of
dividends to the investors
who intend to generate high
level of return from
investment.
Pact Group Material Dec-13 $648.8m $648.8m
The main purpose of the
offer is to activate the listing
of the organization in ASX
and providing relevant option
for the liquid market. In
addition, the IPO would
provide financial flexibility
to pursue future growth
opportunities. This also
provide future access to
capital markets and realize a
portion of its investment,
while maintaining a
significant ongoing interest
in pact.
The above data has been derived from the prospectus of National Storage, Sandon
Capital Investments and Pact Group during the period of 2013. The prospectus directly
provided all the relevant information regarding the industry type, IPO date, funds intended to
raise and fund raised by the organization after the initial public offerings. Further analysis
was provided on the main purposes that were used by the management to initiate the public
offering, which is mainly required to provide relevant information to investors regarding the
main motive behind the public offerings (Asx.com.au, 2019).
The main reason behind the IPO of National Storage was to increase aim of the fund
offer was to support the issue of new stapled securities, where transfer of existing stapled
securities. The proceeds from the IPO can be used for Cash-Out facilities and improve the