Core Viewpoint - The Green Shoe Option, also known as the overallotment option, is a mechanism used in IPOs to stabilize stock prices and protect the interests of investors and issuers [1]. Group 1: Definition and Purpose - The Green Shoe Option is a "price stabilizer" for approximately 30 days [6]. - Its core function is to adjust the supply of shares to mitigate significant price fluctuations after a new stock listing [1][3]. Group 2: Operational Mechanics - If the stock price exceeds the issue price, underwriters can request the issuer to issue additional shares (exercise the Green Shoe Option) [2]. - In the initial listing period (usually within 30 days), the lead underwriter aims to stabilize the stock price and prevent it from falling below the issue price by purchasing shares in the secondary market if the price drops [7][10]. - Conversely, if the stock price rises, the underwriter can issue more shares to increase supply and suppress the price [11]. Group 3: Financial Aspects - The funds for this operation come from the overallotment during the IPO, which allows for selling 15% more shares than originally planned, and these funds are locked for market stabilization [9]. - Ultimately, regardless of price movements, underwriters can perfectly settle all shares, earn underwriting fees, and stabilize the stock price, achieving a win-win for issuers, investors, and underwriters [11].

Core Viewpoint - The Hong Kong stock market has seen a surge in fundraising, surpassing HKD 100 billion in the first half of the year, becoming the world's leading market for IPOs, but many companies face challenges due to unfamiliarity with the listing process and regulations [1]. Group 1: Pre-Listing Preparation - The preparation phase consists of five main tasks: gathering necessary financial information, determining target capital structure, reviewing the equity and governance structure of the listing entity, establishing governance structure and board members, and reviewing management compensation and employee incentive plans [1]. Group 2: Execution Phase - The execution phase is divided into three main steps: holding a kickoff meeting, drafting the prospectus, and submitting the listing application [2]. Group 3: IPO Process Overview - The IPO process in Hong Kong includes the following steps: submission of application, hearing, roadshow, public offering, announcement of allocation results, and listing [3]. Group 4: Submission Process - The company appoints sponsors and other advisors to conduct due diligence and assist in preparing the prospectus, which is then submitted to the Hong Kong Stock Exchange along with the IPO fees and a hearing date [5]. Group 5: Hearing Process - The hearing is a comprehensive evaluation of the application materials by the Stock Exchange. Once approved, the company can prepare for the subscription date [6]. Group 6: Roadshow - After the hearing, the company, along with its sponsors and financial public relations, conducts a series of promotional activities known as roadshows, which typically last about one week [7]. Group 7: Public Offering - The public offering consists of two parts: "international placement" and "public subscription," usually accounting for approximately 90% and 10% of the total new shares issued, respectively [8][10]. Group 8: Allocation Results Announcement - Approximately seven days after the public offering period, the company announces the allocation results, including final pricing and subscription oversubscription rates [11]. Group 9: Dark Pool Trading - Dark pool trading occurs before the official listing, allowing for off-exchange trading of new shares [12]. Group 10: Post-Listing Support - After listing, the company enters a post-listing support phase, where major shareholders may lend shares to underwriters to stabilize the stock price [14][15]. Group 11: Green Shoe Mechanism - The green shoe mechanism allows underwriters to buy back shares to support the stock price if it falls below the offering price, or to issue additional shares if the price rises significantly [15][17].

Group 1 - The article discusses the roles and responsibilities of IPO sponsors and underwriters in the Hong Kong IPO process, clarifying their collaboration and distinctions [1][3]. - IPO sponsors are described as the "chief engineers" of the listing process, responsible for due diligence, drafting the prospectus, regulatory communication, and ongoing compliance supervision for at least two years post-listing [3][8]. - Major IPO sponsors in Hong Kong include international investment banks like Goldman Sachs and Morgan Stanley, as well as Chinese securities firms like CICC and CITIC [3]. Group 2 - Underwriters are characterized as the "sales force" for the stocks, focusing on pricing, distribution, and ensuring successful fundraising during the IPO [4][5]. - Key functions of underwriters include determining the issue price through book building, stabilizing the stock price post-listing using the green shoe option, and covering a wide range of investors [6][7]. - The article notes that large IPOs often involve multiple underwriters, categorized into global coordinators, book managers, and joint lead managers [7]. Group 3 - The article outlines the different phases of the IPO process, indicating that sponsors lead during the preparation phase, while underwriters take a more prominent role during the pricing phase [8][9]. - After the listing, sponsors continue to oversee compliance, while underwriters may provide additional financing services [10]. - The collaboration between sponsors and underwriters is essential for the success of an IPO, with each playing a distinct yet complementary role [10].

Group 1 - Cirsa, a Spanish gaming company controlled by Blackstone, has launched an IPO that has garnered significant attention in global capital markets, being considered one of the most notable IPOs in Spain for 2025 [1] - The IPO was officially opened to investors on July 3 and is set to close on July 7, with shares expected to be allocated on the same day and trading to commence on July 9 [1] - Cirsa aims for a valuation target of €2.52 billion (approximately $2.97 billion) with an expected issuance size between €453 million and €521 million [1] Group 2 - The IPO includes a greenshoe option, allowing for additional share issuance if market demand is strong, providing flexibility for Cirsa to expand its financing [6] - The offering also involves the transfer of shares from existing shareholders, indicating a proactive approach to capital structure adjustments by the company and its investors [6] - The underwriting syndicate consists of major financial institutions including BBVA, Jefferies, Mediobanca, Société Générale, and UBS, ensuring liquidity and strong participation from international investors [6] Group 3 - Cirsa is the largest casino operator in Spain and has expanded its operations into Italy, Morocco, and various Latin American markets, with recent expansions into Portugal and Puerto Rico [6] - The successful IPO of Cirsa is expected to boost market sentiment in Spain, which has not seen large IPOs for several months, potentially revitalizing the capital market [6] - The IPO is seen as a reflection of the recovering European capital market, positively influencing investor sentiment in the Eurozone [7]

Group 1 - The Hong Kong stock market has seen a surge in investment opportunities this year, with a notable increase in IPO activities, as evidenced by a 720% increase in fundraising in the first five months [1] - As of June 16, 31 new stocks have been listed in Hong Kong this year, with 18 experiencing positive returns on their first trading day, while 9 stocks faced a decline, resulting in a 29% failure rate, which is a significant decrease compared to the previous two years [1] - The stock "Ying En Biological" recorded a remarkable first-day increase of 116.7%, indicating potential profits of around HKD 10,000 for investors who subscribed to one lot [1] Group 2 - As of May 30, there are 158 companies in the "processing" status for IPO applications, with approximately 60 companies announcing or applying for dual listings in both A and H shares [2] - The recent strong performances of companies like CATL, 恒瑞医药, and 吉宏控股 have attracted significant attention and investment in A+H new stocks [2] Group 3 - The IPO process in Hong Kong requires investors to have a Hong Kong bank account and a securities account, as A-share accounts cannot participate in Hong Kong IPOs [6] - The typical IPO process involves a 30-day period for the company to open the subscription process after passing the Hong Kong Stock Exchange hearing, with the subscription period lasting 3 to 6 days [7] - The distribution mechanism for public offerings divides investors into two groups: Group A (small investors) and Group B (large investors), with shares allocated equally between the two groups [13] Group 4 - The "return mechanism" allows for a portion of shares initially allocated to international placements to be reallocated to public offerings when demand is high, which can significantly increase the chances of winning shares for retail investors [9] - Historical data shows that companies with a "return mechanism" tend to perform better on their first trading day, with a lower failure rate [10][11] Group 5 - The average subscription multiple for new stocks in Hong Kong has reached 148 times this year, the highest since 2019, indicating strong market interest [21] - Factors influencing the success of IPOs include the reputation of the underwriter, the presence of cornerstone investors, and the green shoe mechanism, which helps stabilize stock prices post-IPO [20][21]

Group 1 - The intermediary system for NASDAQ IPOs is crucial for connecting local operations with international capital markets, directly impacting the success rate and financing efficiency of listings [1] - Key intermediary institutions include investment banks, law firms, accounting firms, depositary banks, market makers, and public relations and investor relations consultants [1][27] - The article provides a comprehensive analysis of the roles, service offerings, fee structures, and selection strategies of these intermediaries, along with practical guidelines for 2025 market dynamics [1] Group 2 - Investment banks play a vital role in valuation pricing, roadshow strategies, and risk hedging, with underwriting fees ranging from 5-7% for amounts less than $100 million and 3-5% for amounts greater than $500 million [2][40] - Law firms are responsible for cross-border compliance, including VIE structure reviews and data security, with fixed fees between $500,000 and $2 million depending on complexity [3][4][40] - Accounting firms focus on financial restructuring and internal control establishment, charging between $500,000 and $1.5 million based on revenue [7][10][40] Group 3 - Depositary banks facilitate the issuance of American Depositary Receipts (ADRs) and cross-border settlements, with fees ranging from $50,000 to $200,000 [12][15][40] - Market makers manage liquidity and crisis response, charging annual fees between $100,000 and $500,000 [17][20][40] - Public relations and investor relations consultants assist in brand building and crisis management, with service fees ranging from $200,000 to $1 million [22][25][40] Group 4 - The overall fee structure for intermediaries in the IPO process can range from $200,000 to $600,000, accounting for 8-15% of the total financing amount [40] - Cost optimization strategies include selecting boutique investment banks for smaller fundraising and splitting auditing tasks to save costs [41] - The selection of intermediaries should consider industry expertise, regional experience, and crisis management capabilities [42][44] Group 5 - The intermediary system for NASDAQ listings exhibits a dual characteristic of "international rules + local adaptation," requiring firms to navigate both global standards and local regulatory environments [47][48] - Companies should prioritize intermediaries with capabilities that blend Western and Chinese practices to ensure compliance and efficiency in the IPO process [49]