Tom and Rachel's small business, running under the trade name, SA Farms Pty Ltd (SAFPL). traces its history back to the 1880s, when Tom and Rachel Smith emigrated to Australia from England. In the late 1880s, the Henrys moved to the south-east of South Australia and founded a farming business in wheat and sheep.

The farming business grew and diversified over time; ownership stayed largely in the family.

In 2020-21, SAFPL's revenue was $78 million and it had 30 employees.

Ownership Structure

SAFPL is a proprietary company limited by shares. It was registered in 1981 to acquire the family's farm businesses which had until that time been operating through several small companies, trusts and partnerships. There are 120 ordinary shares on issue, all held by members of the Henry family (or by trusts or companies controlled by them).

Management structure

SAFPL has four directors. They are David Smith, Nick Smith, Patricia Smith and Peter O'Donnell. Peter has been a trusted friend of the family for many years and has a background in transport and agribusiness. He is the managing director and controlling shareholder of RiverTrans Pty Ltd, a trucking company based in the Riverina.

YOUR TASK:

SAFPL has approached your firm to help it grow its business size by being able to invite more capital through shares issue. In this regard, your firm has asked you to provide a business report on the following questions:

Using ASIC's website, or the textbook (with proper referencing), provide report on the below:

1. Is an increased capital possible if the SAFPL converts itself from a proprietary company limited by shares to a public company limited by shares? If yes, explain the following:
   1. Steps to convert from a proprietary company to a public company limited by shares
   2. After conversion to a public company, citing the relevant sections from the Corporations Act, what are new requirements that SAFPL would have to comply with on the following matters:
      1. Appointment of Directors
      2. Holding an Annual General Meeting (AGM)
      3. Annual Financial Reports
      4. Appointment of Auditors
      5. Access to registers to members and public inspection
2. In the near future, SAFPL would like to become a listed public company. Advise them on the process of listing in Australia' stock exchange (ASX)?