SC to further relax listing rules on Bursa

  • Business
  • Thursday, 13 Dec 2007

KUALA LUMPUR: The Securities Commission (SC) will further relax rules for foreign firms seeking to sell shares on Bursa Malaysia and those related to mergers and acquisitions (M&As) by listed companies. 

Details on the new initiatives, including changes in requirements for initial public offerings (IPOs), would be reflected in the guidelines due to be released next month.  

“Our objective is to strengthen the positioning of Bursa as the preferred listing destination for domestic companies as well as to attract foreign companies to consider a primary or secondary listing,'' chairman Datuk Zarinah Anwar said. 

She said this in her keynote address at a conference organised by Bursa Malaysia Bhd yesterday. 

“We also wish to create a conducive environment that fosters more rapid corporate sector expansion both locally and abroad through capital-raising and M&A activities,'' Zarinah added. 

From left: SC executive director Datuk Kris Azman Abdullah, DatukZarinah Anwar and Bursa Malaysia CEO Datuk Yusli Mohamed Yusoffat the press briefing on SC new initiatives

The SC said companies going for listing on Bursa would no longer have to publish profit forecast in their prospectus, but instead include management discussion and analysis (MDA) on the company's financial conditions and prospects. 

“The MDA is intended to increase the quality of useful information and increase the accountability of directors in providing such information,'' Zarinah said. 

The SC will also introduce a public exposure period for IPO prospectuses to enable investors and market participants examine the prospectus pending its registration. 

Zarinah said to improve price discovery post-listing, adjustment on current regulatory framework would be made in line with international practises. 

To help smaller listed companies expand, the SC will allow Mesdaq firms to undertake acquisition that may result in significant change to existing business.  

Currently, only distressed companies on Mesdaq are allowed to do this. 

Acquisitions of assets by listed companies on Bursa no longer need SC approval, unless it resulted in a change of controlling shareholders, board of directors or core business.  

SC approval is still required if the acquisition involved the issuance of new shares or other type of securities. 

For dual listing, companies would be allowed to list their entire equity and the stock can be traded on both Bursa and on the other exchange. 

Full “fungibility” or tradability across exchanges provide investors the flexibility to trade on both exchanges, as well as facilitate cross-border M&As and international fund raising activities. 

To encourage foreign listing on Bursa, the SC will streamline its regulatory criteria for such firms to be subject to the same treatment as for local firms.  

Companies in foreign jurisdiction will also be allowed to list on Bursa. 

Zarinah said the initiatives would increase Bursa's competitiveness against rival exchanges. 

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