Project Management of Australian Stock Index - Case Study Example

Australian Stock Index Project management (Insert Name) (Insert Course) (Instructor’s Name) (Institution Name) 15th September 2011 Brief description of the activities of Aurelia Resources Limited and Bega cheese limited Aurelia Resources Limited is an Australian based company whose activities involve prospecting minerals especially in the Western Australia (Aurelia Resources Limited, 2011). The minerals include gold, copper. Other activities include drilling of copper sulphide and shallow gold in Breakaway dam and in Bonnie Vale North respectively. Bega cheese limited is an Australian firm whose activities include processing, manufacturing and distribution of cheese products (Bega Cheese, 2011). In addition, the company is involved in the manufacturing of other dairy products available in the local and international market. The company has more than 60 brands making it to be the market leaders as far as production of cheese in Australia is concerned. Legal ownership structure of the firms Aurelia Resources Limited leadership is under the McDonald who is the chairman of the company (Aurelia Resources Limited, 2011). With his extensive knowledge in the mining industry, he founded Legend mining NL Company which was the major company which discovered gold in Elizabeth hill in Western Australia. The company has an executive director whose role is to generate projects and to undertake feasibility studies. In addition the executive director is responsible for restructuring of the company as well as spearheading the process of listing the company in the ASX (Gellner, 2007). The company has non-executive directors whose role is to evaluate projects as well as to undertake production roles. Bega cheese limited ownership comprises of Barry Irvin who is the executive chairman and Aidan Coleman who is the chief executive officer (Bega Cheese, 2011). According to the original owners of Aurelia Resources, the company will expand their capital base by going public (Gellner, 2007). This will enable the company to undertake mining projects in Bonnie vale and Break away Dam regions. The purpose of launching an IPO by Bega cheese Limited is to provide the company with financial flexibility that will help the company to undertake industry rationalization (Aurelia Resources Limited, 2011). In the same way, the funds generated from the IPO will help the company in product development and innovation (Gellner, 2007). Underwriting status of the issuers The issue of Aurelia Resources has been underwritten. According to the Aurelia Resources IPO, the company aims to raise more than $3 million leading to the listing of the company in Australian Securities Exchange (Aurelia Resources Limited, 2011). The company has offered fifteen million shares and it has also accepted oversubscription of an extra 5 million shares from the investors. As a result of the large number of floated shares, the company will benefit from a strong capital base of 33.75 million shares once the offer is closed on 30 September 2011 (Aurelia Resources Limited, 2011). In this way, Aurelia Resources will attain adequate funds to drill the targets which have been highly prospective. Bega cheese limited shares have also been underwritten (Bega Cheese, 2011). The IPO was opened on 26 July 2011 and closes on 16 August 2011 according to the prospectus dated 18 July 2011 (Aurelia Resources Limited, 2011). Bega cheese aims at availing 18.35 million shares at the price of $2.00. This will generate revenue of $35 million. Since the company aim is to generate adequate funds from the offer, a share is being sold for $2.00 (Bega Cheese, 2011).5so as to attract high number of Signal mechanisms the issuers and the reasons for using these signals. One of the major signals that were adopted by the Aurelia Resources Company prospectus was that it was only accessible online. This is aimed at ensuring that the potential investors can access the prospectus without difficulties (Aurelia Resources Limited, 2011). The prospectus also directs all the applicants who do not understand the contents of the document to seek help from their financial and financial advisors (Bega Cheese, 2011). This will avoid loss of refunds or making inappropriate decision. The Aurelia Resources indicates the extension of the closing date for the IPO from 27 May 2011 to 30 September 2011. This is helpful to the investors since it enables them to plan their finance in order to participate in the offer before the closing date. The prospectus gives an update of the investigations done on the accounts report. This signal is used by the insurer in order to create investors confidence and trust. In this way, the number of investors will increase. Members of the public who opt to withdraw from Aurelia Resources IPO are also advised to notify the company through a written note before 20 August 2011. This will ensure that the get their funds Other signal which Aurelia Resources IPO could have provided include audited reports for some few years and objectives of the company for the next five years after being listed. Bega cheese limited has used company profile and products to give members of the public clear picture of the activities of the company (Bega Cheese, 2011). Similarly, Bega cheese prospectus indicates the expected shares allotment date and the date the shares trading as away of updating the investors on the performance of the company in ASX. Bega prospectus could also entail foreign markets which the company will venture into in future after the IPO. Aurelia Resources and Bega cheese limited size prior to listing Small business is an entity that is privately owned and has less than 15 employees. In addition, a small business is not dominant in the industry it operates (Longenecker et al, 2008). Based on this definition, it is clear that Aurelia Resources Company is a small business prior to listing. This is based on the fact that the chairman, the executive and the non-executives are the employees of the company (Bega Cheese, 2011). The mining industry in Australia is dominated by large number of firms which are competitor of the Aurelia Resources (Aurelia Resources Limited, 2011). Since the company does not dominate the industry it meets the criteria of being a small business. In order for the company to be a public owned entity it has taken measures to float its shares in order to generate more finance which will make it employ more employees and possibly dominate the mining industry thus making it a public limited company. On the other hand, Bega cheese limited is not a small business (Gellner, 2007). The diversification of the company brands and the merger strategy with already established entities makes the firm to increase its annual revenue as compared to its competitors (Bega Cheese, 2011). The top management team has also continued to recruit experienced employees to work in its factories located in Australia and New Zealand. With over 60 million Bega brands being sold in Australia, the company has become a market dominant (Ali & Gregoriou, 2011). In the same way, the company has acquired many companies since it was established in 1899. As a result, the company has continued to expand its work force to cater for the increased operation in its branches. According to the company prospectus, the company employed more approximately more than 1,400 workers as at May 2011. Since the company is on it final stages to be listed, more employees are eligible to join the firm in near future. References Ali, P., & Gregoriou, G. (2011). International Corporate Governance after Sarbanes-Oxley. Sydney: John Wiley and Sons. Aurelia launches $3 million IPO; funds targeted to Breakaway Dam Copper VMS project. Available from http://www.mining.com/2011/05/13/aurelia-launches-3-million-ipo-funds-targetted-to-breakaway-dam-copper-vms-project/. . Retrieved on September 16, 2010 Aurelia Resources Limited. (2011). Home. Retrieved from http://www.aureliaresources.com/ Bega Cheese. 2011. Home. Retrieved from http://www.begacheese.com.au/ Gellner, P. (2007). How Do Ownership Structures Determine the Performance of Professional Service Firms? New York: GRIN Verlag. Information on Aurelia Resources Company management team. Available from http://www.aureliaresources.com Retrieved on September 16, 2010 Longenecker, Justin G. Carlos W. Moore, J. William Petty, Leslie E. Palich (2008) Small business management: launching and growing entrepreneurial ventures.Oxford: Oxford University Press Read More