THE Securities Commission (SC) has introduced a set of criteria for de-listed PN4 companies seeking re-listing on the KLSE.
These de-listed companies must demonstrate that they are financially strong and have identified the causes that led to their past state of financial distress. They must also have new dominant shareholders and management.
Moreover, the assets of these PN4 companies, including new assets to be injected, must be of good quality and able to rectify their profitability, cashflow and balance sheet problems, the SC said in a statement yesterday.
The SC said that towards this end, submissions to the commission could only be made after independent investigative audits on the previous affairs of the de-listed PN4 companies had been completed.
De-listed PN4 companies that submit their applications within 12 months from the date of notification of the KLSE's decision to de-list their securities from the Official List of the KLSE can seek re-listing via introduction and need not make an offering to the general public.
They can also list based on their pro forma accounts without fulfilling the conditions on common directors and common controlling shareholders.
The condition for similar or complementary business, however, must be fulfilled in meeting the historical profit track record requirement for listing.
SC chairman Datuk Ali Abdul Kadir said the criteria would ensure the re-listed companies conformed to the standards expected from listed companies.
We want to ensure that the re-listed company starts with a clean bill of health and that it will be run by responsible management. As such, we have imposed some additional conditions. For example, we require that the old management, which may have caused all the problems, must go.
The chance to re-list would be a new lease of life for the de-listed PN4 companies. It is given following requests from institutional and minority interests, as well as industry participants.
Those who want to get back on should do so as soon as possible so that shareholders, especially the minority shareholders, can recover the value of their shareholdings, said Ali.
On the relaxation of the use of pro forma accounts, he said, it is an attractive flexibility as it would allow the pooling of assets by white knights to be injected into the de-listed PN4 company.
Other existing qualitative and quantitative requirements for new listing of companies remain.
Ali stressed that the SC would continue to pursue enforcement actions against the directors and management of PN4 companies who had mismanaged their companies, even if they were de-listed.
Pursuant to the Securities Commission Act 1993, corporate proposals and securities transactions involving de-listed PN4 companies, such as the issue/offer of securities, or take-overs and mergers, continue to be subject to the SC's regulatory requirements unless expressly exempted under the act.
Issued under Guidance Note 6A of the SC's Policies and Guidelines on the Issue/Offer of Securities, the new criteria are available on the SC's website at www.sc.com.my.