Public Companies

Public Companies – Financing and Regulatory Issues (on-line course)

This elective course examines the public markets in Canada, as well as provides an overview of the U.S.A. and U.K. markets, including the disclosures and public documents that are available to assist valuators in the valuation or comparative analysis of both public and private companies.

MODULE 1: Introduction to Public Markets

Accessing the public markets to obtain financing for companies requires chartered business valuators (CBVs) to have an awareness of the available public markets and an understanding of the related regulatory regimes. In today’s economy, the markets for products and services are international and, as a result, sources for available funding are also international.

In Canada, companies have a long history of obtaining financing from international sources, as well as from Canadian markets. The United States of America (U.S.) and the United Kingdom (UK) provide financing sources as well as markets for products and services of many Canadian companies. This module discusses public equity markets, with a focus on the Canadian markets and regulations, including:

The international securities markets and the common objectives and principles of securities regulation;
The Canadian regulations based on provincial laws, self-regulatory organizations (SROs), and applicable federal legislation;
The U.S. public markets as a source of funding and related regulatory issues; and
The UK public markets as a source of funding and related regulatory issues.

MODULE 2: Going Public

Once companies grow beyond a certain point, senior management will likely consider the possibility of going public. This can be a very challenging time as once the decision has been made, different avenues that can be taken to going public and many different players will become involved. Once the company is public, it does not get simpler as subsequent financings and restructurings may have to be considered, which will have a major impact on the company.

This module discusses:
The pros and cons of being a public company;
The process of going public;
The prospectus and other documentation requirements;
Provincial reporting requirements;
Roles of the underwriter, promoter and brokers;
Alternatives to an initial public offering (IPO);
What a company can expect once it is public;
Income trust overview;
Completing secondary offerings;
Completing acquisitions of public companies; and
Going private.

MODULE 3: Sources of Capital

A company can raise money by issuing debt or by selling shares (equity). Borrowing from a financial intermediary, such as a commercial bank, is a private transaction between the lender and the company.

This module focuses on raising capital through the issuance of “securities” (as defined under the provincial acts) and the raising of debt through more traditional lenders. Securities can be debt or equity and can be issued to the public or through so-called private placements.

This module discusses:

Debt issuance and related topics such as credit assessment and terms, lending agreements;
Rates, bonds and debentures and the categories and priorities of debt;
Equity issuance through secondary or treasury issues, syndication and pricing;
Alternative sources of financing including convertible debt, rights and warrants.

Throughout the module notes, references and links are included for quick access to documents on websites of government agencies, self-regulatory organizations and certain companies. These references provide authoritative sources of information relevant to the course, as well as for future research.

MODULE 4: Continuous Disclosures and Reporting by Public Companies

Public companies have significant obligations to provide continuous disclosure and routine financial reporting. Each country or jurisdiction imposes regulations in accordance with their own objectives and principles, which may be influenced by the International Organization of Securities Commissions (IOSCO).

Companies in Canada that obtain, or plan to obtain financing, from Canadian public markets, U.S. public markets or from companies directly impacted by U.S. public market regulations must understand the relevant regulations. In addition, the valuator’s knowledge of the regulations and the availability of public company documents could assist in determining company valuations through industry research and comparables.

This module discusses:

The key disclosure documents in Canada and in the U.S.A.; and
How to access the relevant documents and related regulations.

Throughout this module, you will find references and links to documents on websites of government agencies, self-regulatory organizations and certain companies. The references provide authoritative sources of information relevant to the course as well as for future research.

Textbooks required:

Corporate Finance for Canadian Executives, Johnson, H., Carswell. (Ref.#9780779813544)