INTERNATIONAL ORGANISATIONS USING IPO

Agricultural Bank of China Limited (ABC) also known as AgBank, is the one of
the "Big Four" banks in the People's Republic of China. It was founded in 1951, and
has its headquarters in Beijing and has branches throughout mainland China, and also
in Hong Kong and Singapore. It employs over 300,000 people.

ABC has 320 million retail customers, 2.7 million corporate clients, and nearly 24,000
branches. By the end of 2008, the Agricultural Bank of China has 7.01 trillion yuan in
total assets, second only to the Industrial and Commercial Bank of China (ICBC).
ABC went public in 2010, fetching the world's biggest initial public offering (IPO).

History
After establishment of the People's Republic of China, ABC has been formed and
abolished several times. In 1951, two banks of the Republic of China, Farmers Bank
of China and Cooperation Bank, merged to form Agricultural Cooperation Bank,
which ABC regards as its precedent. However, the bank was merged into People's
Bank of China, the central bank in 1952. The first bank bearing the name
Agricultural Bank of China was founded in 1955, but was again, merged into the
central bank in 1957. In 1963, Chinese government formed another agricultural bank,
and it was merged into the central bank two years later. Today's ABC was founded in
February, 1979. It was restructured to form a holding company called Agricultural
Bank of China Limited. It was listed in July 2010.

The Agricultural Bank was the victim of the largest bank robbery in Chinese history
in April 2007, when two vault managers at the Handan branch of the ABC in Hebei
province embezzled almost 51 million yuan.

2010 initial public offering

ABC was the last of the "big four" banks of China to go public. In 2010, A shares and
H shares of Agricultural Bank of China were listed on the Shanghai Stock Exchange
and the Hong Kong Stock Exchange respectively. A share was set between RMB$2.7
and RMB$3.3 per share. H share was set between HK$2.88 and HK$3.48 per share.

The final share price for the IPO launch will be issued on July 7, 2010. It is set to be
the world's biggest initial public offering (IPO) surpassing the one set by Industrial
and Commercial Bank of China in 2006 of $21.9 billion. The bank aims to sell a 14%
stake for $23bn (£15.3bn). It will also float on the Shanghai market. Qatari and
Kuwaiti sovereign wealth funds are already set to invest $3.6bn in the IPO. Standard
Chartered has said it will invest $500m in the bank. Other likely investors include
Temasek Holdings, Hong Kong businessman Li Ka Shing and Rabobank of the
Netherlands.

AgBank raised $19.21 billion in an IPO in Hong Kong and Shanghai on July 6, 2010
and it could raise $22.1 billion if, as expected, both overallotment options are
exercised. The IPO was once thought to be able to raise US$30 billion, but weaker
market sentiment dampened the value.
Shenzhen Stock Exchange

Type Stock Exchange

Location Shenzhen,
China Founded December 1, 1990
Key people Chen Dongzheng (Chairman)
Song Liping (President and CEO)
Currency RMB
No. of listings 540
MarketCap RMB 1 trillion (2009)
Indexes SZSE Component Index
Website www.szse.cn

Shenzhen Stock Exchange : is one of the People's Republic of China's three stock
exchanges, alongside the Shanghai Stock Exchange and the Hong Kong Stock
Exchange. It is the 9th largest stock exchange in Asia by market capitalisation[1]
(2008), and is based in Shenzhen, China.

A shares on the Shanghai and Shenzhen stock exchanges refers to those that are
traded in Renminbi, the currency in mainland China. Some shares on the two
mainland Chinese stock exchanges, known as B shares, are traded in foreign
currencies.

H shares refers to the shares of companies incorporated in mainland China that are
traded on the Hong Kong Stock Exchange. Many companies float their shares
simultaneously on the Hong Kong market and one of the two mainland Chinese stock
exchanges.

Huge price discrepancies between the H shares and the A share counterparts of the
same company are not uncommon. A shares generally trade at a premium to H shares
as the People's Republic of China government restricts mainland Chinese people from
investing abroad, and foreigners from investing in the A-share markets in mainland
China
ADVANTAGES AND DISADVANTAGES

The decision to take a company public in the form of an initial public offering (IPO)
should not be considered lightly. There are several advantages and disadvantages to
being a public company, which should thoroughly be considered. This memorandum
will discuss the advantages and disadvantages of conducting an IPO and will briefly
discuss the steps to be taken to register an offering for sale to the public. The purpose
of this memorandum is to provide a thumbnail sketch of the process. The reader
should understand that the process is very time consuming and complicated and
companies should undertake this process only after serious consideration of the
advantages and disadvantages and discussions with qualified advisors.

ADVANTAGES AND DISADVANTAGES OF AN IPO

Advantages:

1. Increased Capital. A public offering will allow a company to raise capital to

use for various corporate purposes such as working capital, acquisitions,
research and development, marketing, and expanding plant and equipment.
2. Liquidity. Once shares of a company are traded on a public exchange, those
shares have a market value and can be resold. This allows a company to attract
and retain employees by offering stock incentive packages to those employees.
Moreover, it also provides investors in the company the option to trade their
shares thus enhancing investor confidence.
3. Increased Prestige. Public companies often are better known and more visible
than private companies, this enables them to obtain a larger market for their
goods or services. Public companies are able to have access to larger pools of
capital as well as different types of capital.
4. Valuation. Public trading of a company's shares sets a value for the company
that is set by the public market and not through more subjective standards set
by a private valuator. This is helpful for a company that is looking for a
merger or acquisition. It also allows the shareholders to know the value of the
shares.
5. Increased wealth. The founders of the company often have the sense of
increased wealth as a result of the IPO. Prior to the IPO these shares were
illiquid and had a more subjective price. These shares now have an
ascertainable price and after any lockup period these shares may be sold to the
public, subject to limitations of federal and state securities laws.

There are numerous disadvantages to going public.

1. Time and Expense. Conducting an IPO is time consuming and expensive. A

successful IPO can take up to a year or more to complete and a company can
expect to spend several hundreds of thousands of dollars on attorneys,
accountants, and printers. In addition, the underwriter's fees can range from
3% to 10% of the value of the offering. Due to the time and expense of
preparation of the IPO, many companies simply cannot afford the time or
spare the expense of preparing the IPO.
 2. Disclosure. The SEC disclosure rules are very extensive. Once a company is a
reporting company it must provide information regarding compensation of
senior management, transactions with parties related to the company, conflicts
of interest, competitive positions, how the company intends to develop future
products, material contracts, and lawsuits. In addition, once the offering
statement is effective, a company will be required to make financial
disclosures required by the Securities and Exchange Act of 1934. The 1934
Act requires public companies to file quarterly statements containing
unaudited financial statements and audited financial statements annually.
These statements must also contain updated information regarding
nonfinancial matters similar to information provided in the initial registration
statement. This usually entails retaining lawyers and auditors to prepare these
quarterly and annual statements. In addition, a company must report certain
material events as they arise. This information is available to investors,
employees, and competitors.
3. Decisions based upon Stock Price. Management's decisions may be effected
by the market price of the shares and the feeling that they must get market
recognition for the company's stock.
4. Regulatory Review. The Company will be open to review by the SEC to
ensure that the company is making the appropriate filings with all relevant
disclosures.
5. Falling Stock Price. If the shares of the company's stock fall, the company
may lose market confidence, decreased valuation of the company may effect
lines of credits, secondary offering pricing, the company's ability to maintain
employees, and the personal wealth of insiders and investors.
6. Vulnerablility. If a large portion of the company's shares are sold to the public,
the company may become a target for a takeover, causing insiders to lose
control. A takeover bid may be the result of shareholders being upset with
management or corporate raiders looking for an opportunity. Defending a
hostile bid can be both expensive and time consuming.

Once a company has weighed the advantages and disadvantages of being a public
company, if it decides that it would like to conduct an IPO it will have to retain a lead
underwriter to sell the securities, an attorney to assist in the preparation of a
registration statement, and auditors to prepare financial statements.

Jet Airways launches IPO

Leading Indian carrier Jet Airways' has announced the details of its IPO. (Scroll
down to read our curtain-raiser on the Jet IPO)

11 February 2005

Jet Airways has announced the details of its IPO. The Jet Airways IPO will be of 1.72
crore shares of Rs 10 each to raise a maximum of up to Rs 1942.50 crore. The fully
book-built issue is opening 100 per cent book built issue will open for bids on
February 18 and close on February 24.
The price band for the issue has been fixed at Rs. 950 and Rs. 1,125 per share. Of the
total offer, Jet Airways is making fresh issue of 1.42 crore equity shares and balance
30.21 lakh shares are an offer for sale by Tail Wings Ltd.

The combined offer constitutes 20 per cent of fully diluted post offer paid up equity
capital of the company.

A part of the proceeds of IPO would be used to retire some debt of the company. The
company executive director Saroj datta said that the brand and trademarks would be
transferred to Jet Airways by Jet Enterprises.

This process of transfer would be done over six months on payment of consideration
which would be based on independent valuation by professional agency.

Gunit chadha, head of Deutsche Bank (India), whose investment banking arm is one
of the lead managers for issue, said, the pricing for the IPO would be firmed up by
February 28 and the listing on the stock exchanges is likely to take place by March
14.

On valuation of Jet Airways' assets, UBS Securities Ltd Managing Director Manisha
Girotra said the pricing was based on fair valuation done by comparing with listed
airlines abroad like Ryan air and Singapore Airlines.

The valuation for IPO pricing had to be done by comparing it with foreign airlines as
none of the airlines are listed on the Indian stock exchanges, Girotra said.

Earlier, two Indian airlines had issued shares and their stocks were listed on stock
exchanges. But, these companies later folded their operations.

Out of total offer, 12 lakh shares are reserved for Jet Airways employees. There
would be 60 per cent allocation for institutional investors, upto 15 per cent to high net
worth individuals and upto 25 per cent to retail investors.

Deutsche Equities India Pvt Ltd, HSBC Securities And Capital Markets (India), UBS
Securities India Pvt Ltd, Citigroup Global Markets India, DSP Merrill Lynch Ltd and
Kotak Mahindra Capital Company Ltd are book running lead manager for the IPO.