Chapter 1 INTRODUCTION
Chapter 2
DEFINITIONS
Chapter 3
CORPORATE GOVERNANCE
Chapter 4
CONFLICT OF INTEREST
PART II: POLICY GUIDELINES
CHAPTER 5
EQUITY OFFERINGS AND LISTINGS
5.01 THIS CHAPTER SETS OUT THE REQUIREMENTS FOR THE FOLLOWING PROPOSALS:
(A) EQUITY OFFERING AND PRIMARY LISTING OF A CORPORATION, OTHER THAN A SPAC, ON BURSA SECURITIES; AND
(B) SECONDARY LISTING OF A FOREIGN CORPORATION ON BURSA SECURITIES.
PART A:
EQUITY OFFERING AND PRIMARY LISTING OF A CORPORATION, OTHER
THAN A SPAC, ON BURSA SECURITIES
ROUTES FOR LISTING
5.02 AN APPLICANT WHOSE CORE BUSINESS IS NOT THAT OF INFRASTRUCTURE PROJECT MUST SATISFY EITHER THE PROFIT TEST OR MARKET CAPITALISATION TEST. AN APPLICANT WHOSE CORE BUSINESS IS THAT OF INFRASTRUCTURE PROJECT MUST SATISFY THE INFRASTRUCTURE PROJECT CORPORATION TEST.
Definitions - (a) Core business, (c) Infrastructure project, (c) The profit test and (d)Market capitalization test.
CORE BUSINESS
Core Business means the business which provides the principal source of operating revenue or after-tax profit to a corporation and which comprises the principal activities of the corporation and its subsidiary companies.
INFRASTRUCTURE PROJECT
(a) means a project which creates the basic physical structures or foundations for the delivery of essential public goods and services that are necessary for the economic development of a state, territory or country, such as the construction and operation of roads, bridges, tunnels, railways, mass transit systems, seaports, airports, water and sewage systems, sewerage systems, power plants, gas supply systems and telecommunication systems
INFRASTRUCTURE PROJECT CORPORATION / IPC.
IPC means a corporation whose core business is building and operating an
infrastructure project.
THE PROFIT TEST
The Profit Test is based on the absolute amount of reported profit or loss for each operating segment. If an operating segment’s absolute amount of profit or loss is 10% or more of the greater of either
(1) the combined loss of all operating segments that reported a loss, or
(2) the combined profit of all operating segments that reported a profit, then the operating segment is a reportable segment.
This test will usually yield different results than simply comparing the operating segment’s profit or loss to consolidated profit or loss.
(A) PROFIT TEST
(I) PROFIT REQUIREMENTS
THE APPLICANT MUST HAVE AN UNINTERRUPTED PROFIT OF THREE TO FIVE FULL FINANCIAL YEARS BASED ON AUDITED FINANCIAL STATEMENTS PRIOR TO SUBMISSION TO THE SC, WITH AN AGGREGATE AFTER-TAX PROFIT OF AT LEAST RM20 MILLION AND AN AFTER-TAX PROFIT FOR THE MOST RECENT FINANCIAL YEAR OF AT LEAST RM6 MILLION. IN FULFILLING THE PROFIT REQUIREMENTS, CONTRIBUTIONS FROM ASSOCIATED COMPANIES MUST NOT EXCEED THOSE OF SUBSIDIARY COMPANIES.
Important Remarks:
Uninterrupted profit after tax (PAT) at least RM20 Million
And PAT for the most recent year at least RM6 Million
FYR = -5
FYR = -4
FYR = -3
FYR = -2
FYR = -1
Submission for LISTING
(II) OPERATING HISTORY
THE APPLICANT OR THE CORPORATION WITHIN THE GROUP WHICH IS THE SINGLE LARGEST CONTRIBUTOR TO THE AFTER-TAX PROFITS FOR THE MOST RECENT THREE FULL FINANCIAL YEARS, ON AN AVERAGE BASIS, BASED ON AUDITED FINANCIAL STATEMENTS, MUST HAVE BEEN OPERATING IN THE SAME CORE BUSINESS OVER AT LEAST THE PROFIT TRACK RECORD PERIOD PRIOR TO SUBMISSION TO THE SC.
Important Remarks:
Main Corporation/core business
The PAT of the Applicant must be more than the PAT of all the subsidiaries or within the group.
Applicant/The Related Corporation
Subsidiary 1
Subsidiary 2
Subsidiary 3
(B) MARKET CAPITALISATION TEST / MCAP TEST
(I) MARKET CAPITALISATION REQUIREMENT
THE APPLICANT’S ORDINARY SHARES MUST HAVE A TOTAL MARKET CAPITALISATION OF AT LEAST RM500 MILLION BASED ON THE ISSUE OR OFFER PRICE AS STATED IN THE PROSPECTUS AND THE ENLARGED ISSUED SHARE CAPITAL UPON LISTING.
Important Remarks:
Market capitalization - Applicant's Ordinary Shares
=
Must have a total market capitalization of at least RM500 Million
(II) OPERATING HISTORY
THE APPLICANT OR THE CORPORATION WITHIN THE GROUP REPRESENTING THE CORE BUSINESS MUST HAVE BEEN INCORPORATED AND GENERATED OPERATING REVENUE FOR AT LEAST ONE FULL FINANCIAL YEAR BASED ON AUDITED FINANCIAL STATEMENTS PRIOR TO SUBMISSION TO THE SC.
Important Remarks:
Operating history - Applicant or the corporation within the group representing the CORE BUSINESS
=
Must have been incorporated and generated operating revenue for at least 1 year based on audited financial statement
(C) INFRASTRUCTURE PROJECT CORPORATION TEST / IPC TEST
(I) THE APPLICANT, EITHER DIRECTLY OR THROUGH ITS SUBSIDIARY COMPANY, MUST HAVE THE RIGHT TO BUILD AND OPERATE AN INFRASTRUCTURE PROJECT, WHETHER LOCATED IN MALAYSIA OR OUTSIDE MALAYSIA
• WITH PROJECT COSTS OF NOT LESS THAN RM500 MILLION; AND
• FOR WHICH A CONCESSION OR LICENCE HAS BEEN AWARDED BY A GOVERNMENT OR A STATE AGENCY, IN OR OUTSIDE OF MALAYSIA, WITH A REMAINING CONCESSION OR LICENCE PERIOD OF AT LEAST 15 YEARS FROM THE DATE OF SUBMISSION TO THE SC.
Important Remarks:
Applicant or through its subsidiary company
(To build & operate an infrastructure project in Malaysia or overseas)
=
(a) The project cost NOT LESS THAN RM500 Million and
(b) With a concession or license given by a government/state agency for the period of AT LEAST 15 YEARS from the date of submission for LISTING.
(II) THE SC MAY CONSIDER THE LISTING PROPOSAL BY AN APPLICANT WITH A SHORTER REMAINING CONCESSION OR LICENCE PERIOD FROM THE DATE OF SUBMISSION TO THE SC, IF THE APPLICANT FULFILS THE PROFIT REQUIREMENTS UNDER THE PROFIT TEST.
Remarks:
Applicant or through its subsidiary company
(To build & operate an infrastructure project in Malaysia or overseas)
=
(a) The SC may CONSIDER the listing proposal by the applicant if the related concession or license given by a government/state agency for the period LESS THAN 15 YEARS if the Applicant fulfils the PROFIT REQUREMENTS under the Profit TEST.
CORE BUSINESS
5.03 AN APPLICANT MUST HAVE AN IDENTIFIABLE CORE BUSINESS OF WHICH IT HAS MAJORITY OWNERSHIP AND MANAGEMENT CONTROL.
5.04 THE CORE BUSINESS OF THE APPLICANT MUST NOT BE THE HOLDING OF INVESTMENT IN OTHER LISTED CORPORATIONS.
5.04A IN RELATION TO MOG EXPLORATION OR EXTRACTION ACTIVITIES, A CORPORATION WOULD BE CONSIDERED AS AN MOG CORPORATION IF SUCH ACTIVITIES REPRESENT 50% OR MORE OF ITS TOTAL ASSETS, REVENUE, OPERATING EXPENSES OR AFTER-TAX PROFIT BASED ON AUDITED FINANCIAL STATEMENTS.
5.04B NOTWITHSTANDING PARAGRAPH 5.04A, THE SC MAY DEEM A CORPORATION TO BE AN MOG CORPORATION IF THE CORPORATION’S MOG EXPLORATION OR EXTRACTION ACTIVITIES FORM THE SINGLE LARGEST CONTRIBUTOR TO ITS TOTAL ASSETS, REVENUE, OPERATING EXPENSES OR AFTER-TAX PROFITS BASED ON AUDITED FINANCIAL STATEMENTS. IN THIS REGARD, AN APPLICANT AND ITS ADVISERS MUST SEEK PRIOR CONSULTATION WITH THE SC. MANAGEMENT CONTINUITY AND CAPABILITY.
Important Remarks:
The Applicant
=
Must have an identifiable CORE BUSINESS of which it has a MAJORITY OWNERSHIP and MANAGEMENT CONTROL
The Core Business of
the Applicant
=
Must not be the HOLDING OF INVESTMENT IN OTHER LISTED CORPORATIONS
In relation to MOG Exploration/Extraction Activities
=
A corporation would be considered as an MOG Corporation if such ACTIVITIES REPRESENT 50% OR MORE OF ITS TOTAL ASSETS, REVENUE, OPERATING EXPENSES OR AFTER TAX PROFIT ON AUDITED FY.
MANAGEMENT CONTINUITY AND CAPABILITY
5.05 AN APPLICANT MUST HAVE HAD CONTINUITY OF SUBSTANTIALLY THE SAME MANAGEMENT FOR AT LEAST THREE FULL FINANCIAL YEARS PRIOR TO SUBMISSION TO THE SC OR, IN THE CASE OF AN APPLICANT SEEKING LISTING UNDER THE MARKET CAPITALISATION (MCAP)TEST OR THE INFRASTRUCTURE PROJECT CORPORATION (IPC) TEST, SINCE THE COMMENCEMENT OF ITS OPERATIONS, IF LESS THAN THREE FULL FINANCIAL YEARS.
5.06 IN COMPLYING WITH THE REQUIREMENT ON CONTINUITY OF SUBSTANTIALLY THE SAME MANAGEMENT, THE APPLICANT MUST DEMONSTRATE THAT, THROUGHOUT THE RELEVANT PERIOD–
(A) THE CURRENT EXECUTIVE DIRECTORS OF THE APPLICANT HAVE HAD DIRECT MANAGEMENT RESPONSIBILITIES FOR, AND PLAYED A SIGNIFICANT ROLE IN, THE APPLICANT’S BUSINESS; AND
(B) THE SENIOR MANAGEMENT OF THE APPLICANT HAS NOT CHANGED MATERIALLY.
5.06A THE CHIEF FINANCIAL OFFICER, FINANCE DIRECTOR, OR THE INDIVIDUAL HOLDING AN EQUIVALENT POSITION IN RELATION TO THE APPLICANT’S BUSINESS, MUST HAVE BEEN APPOINTED AT LEAST SIX MONTHS PRIOR TO THE SUBMISSION TO THE SC.
5.07 WHERE THE REQUIREMENTS IN PARAGRAPH 5.06 ARE NOT MET, THE APPLICANT MUST DEMONSTRATE THE EXPERTISE AND CAPABILITY OF ITS MANAGEMENT IN ENSURING THAT ITS OPERATIONS ARE MANAGED EFFECTIVELY.
Important Remarks:
(a) The Applicant
=
(a) Must have had CONTINUITY OF SUBSTANTIALLY THE SAME MANAGEMENT FOR AT LEAST 3 FYS prior to the submission to the SC.
(b) For those seeking under MCap or IPC test since the commencement of its operations if LESS THAN 3 YEARS.
(b) The Applicant
=
MUST DEMONSTRATE (throughout the relevant period):
(a) the CURRENT EXECUTIVE DIRECTORS have had direct management responsibilities for, and played a significant role in, the applicant’s business; and
(b) the SENIOR MANAGEMENT - has not changed materially.
(c) The Applicant
=
The CFO, FD or INDIVIDUAL Holding an equivalent position MUST HAVE BEEN APPOINTED AT LEAST 6 MONTHS prior to the submission to the SC.
(d) The Applicant
=
or if the above requirements (item c) ARE NOT MET, the applicant MUST DEMONSTRATE the expertise and capability of its management in ensuring that its operation are managed effectively.
FINANCIAL POSITION AND LIQUIDITY
5.08 AN APPLICANT MUST HAVE A HEALTHY FINANCIAL POSITION, WITH–
(A) SUFFICIENT LEVEL OF WORKING CAPITAL FOR AT LEAST 12 MONTHS FROM THE DATE OF THE PROSPECTUS. IN THE CASE OF AN APPLICANT WHO IS AN MOG CORPORATION, IT MUST COMPLY WITH PARAGRAPH 5.37A(C) INSTEAD;
(B) POSITIVE CASH FLOW FROM OPERATING ACTIVITIES–
(I) IF LISTING IS SOUGHT UNDER THE PROFIT TEST, OVER THE PROFIT TRACK RECORD PERIOD; OR
(II) IF LISTING IS SOUGHT UNDER THE MARKET CAPITALISATION TEST, IN THE MOST RECENT FINANCIAL YEAR, BASED ON AUDITED FINANCIAL STATEMENTS; AND
(C) NO ACCUMULATED LOSSES BASED ON LATEST AUDITED FINANCIAL STATEMENTS, IF LISTING IS SOUGHT UNDER THE PROFIT TEST.
Important Remarks:
(a) The Applicant
=
MUST HAVE A HEALTHY FINANCIAL POSITION
A. SUFFICIENT LEVEL OR WORKING CAPITAL FOR AT LEAST 12 MONTHS from the date of the prospectus.
For MOG - MUST COMPLY WITH PARAGRAPH 5.37A(c).
Note: Paragraph 5.37A(c): It must have sufficient level of working capital for at least 18 months from the date of the prospectus;
B. POSITIVE CASH FLOW FROM OPERATING ACTIVITIES:
(i) If listing is sought under the PROFIT TEST, over the profit track record period, or
(ii) If listing is sought under MCAP, in the most financial year based on audited FS.
C. NO ACCUMULATED LOSSES on latest audited FS, if listing sought under the PROFIT TEST.
CHAIN LISTING
5.09 CHAIN LISTING IS A TERM USED TO DESCRIBE A SITUATION WHERE A SUBSIDIARY OR A HOLDING COMPANY OF A CORPORATION ALREADY LISTED ON THE MAIN MARKET OR THE ACE MARKET IS SEEKING LISTING ON ITS OWN. IN SUCH A SITUATION, THE FOLLOWING REQUIREMENTS MUST BE MET:
(A) THE APPLICANT MUST BE INVOLVED IN A DISTINCT AND VIABLE BUSINESS OF ITS OWN;
(B) THE RELATIONSHIP BETWEEN THE APPLICANT AND ALL THE OTHER CORPORATIONS WITHIN THE HOLDING COMPANY’S GROUP MUST NOT GIVE RISE TO INTRA-GROUP COMPETITION OR CONFLICT-OF-INTEREST SITUATIONS;
(C) THE APPLICANT MUST DEMONSTRATE THAT IT IS INDEPENDENT FROM THE ALREADY-LISTED CORPORATION AND OTHER CORPORATIONS WITHIN THE GROUP IN TERMS OF ITS OPERATIONS, INCLUDING PURCHASES AND SALES OF GOODS, MANAGEMENT, MANAGEMENT POLICIES AND FINANCE;
(D) THE ALREADY-LISTED CORPORATION MUST:
(I) HAVE A SEPARATE AUTONOMOUS AND SUSTAINABLE BUSINESS OF ITS OWN;
(II) AFTER EXCLUDING ITS INTEREST IN THE APPLICANT, MEET THE PROFIT TEST AS SET OUT IN PARAGRAPH 5.02(A)(I) OR THE MARKET CAPITALISATION TEST AS SET OUT IN PARAGRAPH 5.02(B)(I);
(III) AFTER EXCLUDING ITS INTEREST IN THE APPLICANT, HAVE A HEALTHY FINANCIAL POSITION, WITH:
(A) SUFFICIENT LEVEL OF WORKING CAPITAL TO FUND ITS CONTINUING OPERATIONS FOR AT LEAST 12 MONTHS FROM THE DATE OF SUBMISSION TO THE SC; AND
(B) POSITIVE CASH FLOW FROM OPERATING ACTIVITIES BASED ON LATEST AUDITED FINANCIAL STATEMENTS AT THE TIME OF SUBMISSION TO THE SC; AND
(IV) HAVE CONTINUITY OF SUBSTANTIALLY THE SAME MANAGEMENT FOR AT LEAST THREE FULL FINANCIAL YEARS PRIOR TO SUBMISSION TO THE SC;
(E) WHERE A HOLDING COMPANY OF AN ALREADY-LISTED CORPORATION IS SEEKING LISTING, THE APPLICANT MUST MEET THE REQUIREMENTS FOR LISTING WITHOUT TAKING INTO ACCOUNT THE CONTRIBUTIONS, IN TERMS OF REVENUE, PROFIT OR OTHERWISE, FROM ITS ALREADY-LISTED SUBSIDIARY COMPANY;
(F) THE CHAIN LISTING MUST NOT DETRIMENTALLY AFFECT THE INTERESTS OF THE SHAREHOLDERS OF THE ALREADY-LISTED CORPORATION;
(G) THE BOARD OF DIRECTORS OF THE ALREADY-LISTED CORPORATION MUST MAKE A STATEMENT ON THE RATIONALE FOR THE CHAIN LISTING EXERCISE;
(H) THE SHAREHOLDERS OF THE ALREADY-LISTED CORPORATION MUST BE GIVEN AN ASSURED ENTITLEMENT TO ANY OFFERING OF EXISTING OR NEW SHARES IN THE APPLICANT. THE PERCENTAGE OF SHARES IN THE APPLICANT TO BE ALLOCATED TO THE ASSURED ENTITLEMENT TRANCHE SHOULD BE DETERMINED BY THE DIRECTORS OF THE ALREADY-LISTED CORPORATION AND ALL SHAREHOLDERS OF THE ALREADY-LISTED CORPORATION MUST BE TREATED EQUALLY; AND
(I) FOR PURPOSE OF PARAGRAPH 5.09(D)(II), WHERE THE ALREADY-LISTED CORPORATION HAS TO SATISFY THE MARKET CAPITALISATION TEST, THE ALREADY-LISTED CORPORATION MUST CEASE ITS CONTROL OVER THE APPLICANT. TRANSACTIONS WITH RELATED PARTIES
Important Remarks:
Definitions
CHAIN LISTING - is a term used to describe a situation where a subsidiary or a holding
company of a corporation already listed on the Main Market or the ACE Market is seeking
listing on its own
(a) The Applicant
=
(a) MUST BE INVOLVED in a distinct and viable business of its own; (b) The relationship between the applicant and all the other corporations within the holding company’s group must not give rise to intra-group competition or conflict-of-interest situations;
(b) The RELATIONSHIP WITH all the other corporations within the holding company’s group MUST NOT GIVE RISE to intra-group competition or conflict-of-interest situations;
(c) MUST DEMONSTARATE that it is independent from the already-listed corporation and other corporations within the group in terms of its operations, including purchases and sales of goods, management, management policies and finance;
(d) The ALREADY-LISTED COERPORATION MUST:
(i) HAVE a separate autonomous and sustainable business of its own;
(ii) after excluding its interest in the applicant, MEET THE PROFIT TEST as set out in paragraph 5.02(a)(i) or the MCap test as set out in paragraph 5.02(b)(i);
(iii) after excluding its interest in the applicant, HAVE HEALTHY FINANCIAL POSITIONS, with:
- SUFFICIENT LEVEL OF WORKING CAPITAL to fund its continuing operations for AT LEAST 12 MONTHS from the date of submission to the SC; and
- POSITIVE CASH FLOW from operating activities based on latest audited FSs at the time of submission to the SC; and
(iv) HAVE CONTINUITY of substantially the same management for AT LEAST 3 full FYs prior to submission to the SC;
(e) Where a holding company of an already-listed corporation is seeking listing, the applicant MUST MEET THE REQUIREMENTS FOR LISTING WITHOUT taking into account the contributions, in terms of revenue, profit or otherwise, from its already-listed subsidiary company; (f) The CHAIN LISTING MUST NOT DETRIMENTALLY AFFECT the interests of the shareholders of the already-listed corporation; (g) The BOARD OF DIRECTORS OF THE ALREADY-LISTED CORPORATION MUST make a statement on the rationale for the chain listing exercise; (h) The SHAREHOLDERS OF THE ALREADY-LISTED CORPORATION MUST BE GIVEN AN ASSURED ENTITLEMENT to any offering of existing or new shares in the applicant. The PERCENTAGE OF SHARES in the applicant to be allocated to the assured entitlement tranche SHOULD BE DETERMINED BY THE DIRECTORS of the already-listed corporation and ALL SHAREHOLDERS of the already-listed corporation MUST BE TEATED EQUALLY; and (i) For purpose of paragraph 5.09(d)(ii), where the already-listed corporation HAS TO SATISFY THE MCap test, the already-listed corporation MUAT CEASE ITS CONTROL over the applicant.
C. NO ACCUMULATED LOSSES on latest audited FS, if listing sought under the PROFIT TEST.
TRANSACTIONS WITH RELATED PARTIES
5.10 TRANSACTIONS ENTERED INTO BETWEEN AN APPLICANT OR ANY OF ITS SUBSIDIARY COMPANIES AND RELATED PARTIES PRIOR TO LISTING MUST BE BASED ON TERMS AND CONDITIONS WHICH ARE NOT UNFAVOURABLE TO THE APPLICANT, OTHERWISE, THE SC MAY REGARD AN APPLICANT AS UNSUITABLE FOR LISTING.
5.11 ALL TRADE DEBTS EXCEEDING THE NORMAL CREDIT PERIOD AND ALL NON-TRADE DEBTS, OWING BY THE INTERESTED PERSONS TO THE APPLICANT OR ITS SUBSIDIARY COMPANIES, MUST BE FULLY SETTLED PRIOR TO THE APPLICANT’S LISTING.
Important Remarks:
(a) Transaction entered with related parties prior to listing
=
MUST BE BASED on terms and conditions which ARE NOT UNFAVOURABLE to the applicant, otherwise, the SC MAY REGARD an applicant as unsuitable for listing.
ALL TRADE DEBTS exceeding the normal credit period and ALL NON-TRADE DEBTS, owing by the interested persons to the applicant or its subsidiary companies, MUST BE FULLY SETTLED prior to the applicant’s listing.
ISSUE OF WARRANTS, OPTIONS AND CONVERTIBLE SECURITIES UNDER A LISTING SCHEME
5.12 [DELETED]
5.13 THE EXERCISE PRICE OF WARRANTS AND OPTIONS, AND THE CONVERSION PRICE OF CONVERTIBLE SECURITIES THAT ARE ISSUED PRIOR TO OR AS PART OF THE LISTING SCHEME MUST NOT BE LOWER THAN THE PRICE OF THE ORDINARY SHARES OFFERED TO THE GENERAL PUBLIC UNDER THE INITIAL PUBLIC OFFERING.
Important Remarks:
(a) Warrants and options, and the conversion price of convertible securities
=
The exercise price of those securities that are issued prior to or as part of the listing scheme MUST NOT BE LOWER THAN the price of the ORDINARY SHARES OFFERED to the general public under the initial public offering.
METHODS OF OFFERING OF SECURITIES
GENERAL
5.14 THE METHODS OF OFFERING OF SECURITIES CHOSEN BY AN APPLICANT SHOULD ENABLE THE APPLICANT TO HAVE A BROAD BASE OF SHAREHOLDERS AND COMPLY WITH THE SHAREHOLDING SPREAD REQUIREMENT OF BURSA SECURITIES.
5.15 AN APPLICANT MUST, AS PART OF ITS LISTING SCHEME, UNDERTAKE AN OFFERING OF SECURITIES TO THE GENERAL PUBLIC AND THE ALLOCATION FOR SUCH SECURITIES HAS TO BE MADE THROUGH A BALLOTING PROCESS. THE BALLOTED PORTION MUST CONSTITUTE THE FOLLOWING:
Important Remarks:
(a) Method of offering securities
=
SHOULD ENABLE THE APPLICANT TO HAVE a broad base of shareholders and comply with the shareholding spread requirement of Bursa Securities.
As part of its listing scheme, undertake an offering of securities to the general public and the allocation for such securities JAS TO BE MADE THROUGH A BALLOTING PROCESS. The balloted portion MUST CONSTITUTE the following:
Enlarged issued share
capital
Below RM200 million
RM200 million and above
Minimum offering to the general public
AT LEAST 5% of the enlarged number of shares issued
AT LEAST 2% of the enlarged number of shares issued
5.16 NOTWITHSTANDING THE PROVISION OF PARAGRAPH 5.15, AN OFFERING OF SECURITIES TO THE GENERAL PUBLIC IS NOT REQUIRED IF LISTING OF SECURITIES IS SOUGHT UNDER THE FOLLOWING CIRCUMSTANCES, WHERE–
(A) THE SECURITIES FOR WHICH LISTING IS SOUGHT ARE ALREADY LISTED ON THE ACE MARKET; OR
(B) A LISTED CORPORATION INTENDS TO UNDERTAKE A RESTRICTED OFFER FOR SALE OR DISTRIBUTE IN SPECIE TO ITS SHAREHOLDERS THE SECURITIES OF ITS SUBSIDIARY COMPANY WHICH IS SEEKING LISTING.
5.17 WHERE AN APPLICANT IS SEEKING LISTING UNDER THE INFRASTRUCTURE PROJECT CORPORATION TEST, NO OFFER FOR SALE OF SECURITIES IS ALLOWED, UNLESS THE INFRASTRUCTURE PROJECT HAS GENERATED TWO CONSECUTIVE FULL FINANCIAL YEARS OF OPERATING REVENUE BASED ON THE AUDITED FINANCIAL STATEMENTS PRIOR TO SUBMISSION TO THE SC.
5.17A WHERE AN MOG CORPORATION IS GRANTED RELIEF UNDER PARAGRAPH 5.37B, NO OFFER FOR SALE OF SECURITIES IS ALLOWED AS PART OF THE LISTING PROPOSAL.
5.18 EXPENSES INCURRED RELATING TO AN OFFER FOR SALE OR RESTRICTED OFFER FOR SALE OF SECURITIES SHALL BE BORNE BY THE OFFEROR.
Important Remarks:
(a) Method of offering securities
=
An offering of securities to the general public IS NOT REQUIRED if listing of securities is sought under the following circumstances, where– (a) the securities for which listing is sought ARE ALREADY LISTED ON THE ACE Market; or (b) a listed corporation INTENDS TO UNDERTAKE a restricted offer for sale or DISTRIBUTE IN SPECIE to its shareholders the securities of its subsidiary company which is seeking listing.
Seeking listing under the IPC test, no offer for sale of securities is allowed, unless the IP HAS GENERATED 2 CONSECUTIVE FULL FYs of operating revenue based on the audited FSs prior to submission to the SC. 5.17 A Where an MOG corporation is granted relief under paragraph 5.37B, no offer for sale of securities is allowed as part of the listing proposal.
MOG corporation IS GRANTED RELIEF under paragraph 5.37B, NO OFFER for sale of securities is allowed as part of the listing proposal.
Expenses incurred relating to an offer for sale or restricted offer for sale of securities SHALL BE BORNE BY THE OFFEROR.
PLACEMENT OF SECURITIES
5.19 THE PRINCIPAL ADVISER MUST ACT AS THE PLACEMENT AGENT OR JOINT PLACEMENT AGENT, WHERE APPLICABLE, FOR ANY PLACEMENT OF SECURITIES UNDER AN INITIAL PUBLIC OFFERING AND ENSURE THAT THE PLACEMENT FULLY COMPLIES WITH APPENDIX 4.
5.20 THE SC RESERVES THE DISCRETION TO REQUIRE SUBMISSION OF SUCH FURTHER INFORMATION ON THE PLACEMENT EXERCISE AND THE PLACEES AS THE SC MAY CONSIDER NECESSARY FOR THE PURPOSE OF ESTABLISHING THE PROPRIETY OF THE EXERCISE OR THE INDEPENDENCE OF THE PLACEES.
Remarks:
(a) Placement of securities
=
THE PRINCIPLE ADVISER MUST ACT as the placement agent or joint placement agent, where applicable, for any placement of securities under an initial public offering and ensure that the placement fully complies with Appendix 4.
The SC reserves the discretion to require submission of such further information on the placement exercise and the placees as the SC may consider necessary for the purpose of establishing the propriety of the exercise or the independence of the placees.
RESTRICTED OFFERS
5.21 RESTRICTED OFFERS FOR SALE AND RESTRICTED OFFERS FOR SUBSCRIPTION WHICH ARE UNDERTAKEN AS PART OF A LISTING SCHEME MAY ONLY BE MADE TO THE FOLLOWING GROUPS:
(A) THE DIRECTORS AND EMPLOYEES OF THE APPLICANT;
(B) THE DIRECTORS AND EMPLOYEES OF THE SUBSIDIARY COMPANIES AND HOLDING COMPANY OF THE APPLICANT;
(C) OTHER PERSONS WHO HAVE CONTRIBUTED TO THE SUCCESS OF THE APPLICANT, SUCH AS SUPPLIERS, DISTRIBUTORS, DEALERS AND CUSTOMERS; AND 24
(D) THE SHAREHOLDERS OF THE HOLDING COMPANY OF THE APPLICANT, IF THE HOLDING COMPANY IS LISTED.
5.22 THE AGGREGATE AMOUNT OF SECURITIES THAT MAY BE OFFERED TO THE GROUPS IN PARAGRAPHS 5.21(A), (B) AND (C) MUST NOT BE MORE THAN 10% OF THE ENLARGED NUMBER OF ISSUED SHARES OF THE APPLICANT UPON LISTING OR 25% OF THE TOTAL SECURITIES OFFERED, WHICHEVER IS LOWER.
Important Remarks:
(a) Restricted Offers
=
RESTRICTED OFFERS for sale and RISTRICTER OFFERS for subscription which are undertaken as part of a listing scheme MAY ONLY BE MADE to the following groups:
(a) The DIRECTORS AND EMPLOYEES of the applicant;
(b) The DIRECTOR AND EMPLOYEES of the subsidiary companies and holding company of the applicant;
(c) OTHER PERSONS who have contributed to the success of the applicant, such as suppliers, distributors, dealers and customers; and
(d) THE SHAREHOLDERS of the holding company of the applicant, if the holding company is listed.
THE AGREEGATE AMOUNTB OF SECURITIES that may be offered to the groups in paragraphs 5.21(a), (b) and (c) MUST NOT BE MORE THAN 10% of the enlarged number of issued shares of the applicant upon listing or 25% of the TOTAL SECURITIES OFFERED, whichever is lower.
PRICING OF SECURITIES
5.23 THE ISSUE PRICE OF EQUITY SECURITIES, OTHER THAN WARRANTS AND CONVERTIBLE SECURITIES, OFFERED FOR SUBSCRIPTION OR SALE, FOR WHICH A LISTING IS SOUGHT, MUST BE AT LEAST RM0.50 EACH.
5.24 WHERE SECURITIES ARE OFFERED TO RELATED PARTIES IN CONJUNCTION WITH THE INITIAL PUBLIC OFFERING, THE PRICE OF THE SECURITIES OFFERED TO SUCH RELATED PARTIES MUST BE SET AT LEAST AT THE ISSUE PRICE TO THE GENERAL PUBLIC.
Important Remarks:
(a) Pricing of Securities
=
THE ISSUE PRICE OF EQUITY SECURITIES, other than warrants and convertible securities, offered for subscription or sale, for which a listing is sought, MUST BE AT LEAST RM0.50 EACH.
Where securities are offered to related parties in conjunction with THE INITIAL PUBLIC OFFERING, the price of the securities offered to such related parties MUST BE SET AT LEAST AT THE ISSUE PRICE to the general public.
UNDERWRITING
5.25 UNDERWRITING ARRANGEMENTS IN RELATION TO AN OFFERING OF SECURITIES ARE AT THE DISCRETION OF THE APPLICANT AND ITS PRINCIPAL ADVISER.
5.26 THE PRINCIPAL ADVISER MUST BE PART OF THE SYNDICATE OF UNDERWRITERS FOR THE SECURITIES OFFERED UNDER THE INITIAL PUBLIC OFFERING IF THERE IS AN UNDERWRITING ARRANGEMENT.
5.27 AN APPLICANT SEEKING LISTING ON BURSA SECURITIES MUST DISCLOSE IN ITS PROSPECTUS–
(A) THE MINIMUM LEVEL OF SUBSCRIPTION AND THE BASIS FOR DETERMINING THE MINIMUM LEVEL BASED ON FACTORS, SUCH AS THE LEVEL OF FUNDING REQUIRED BY THE APPLICANT AND THE EXTENT OF THE SHAREHOLDING SPREAD NEEDED; AND
(B) THE LEVEL OF UNDERWRITING THAT HAS BEEN ARRANGED, TOGETHER WITH JUSTIFICATIONS FOR THE LEVEL ARRANGED.
5.28 WHERE THE MINIMUM LEVEL OF SUBSCRIPTION IS NOT ACHIEVED, THE OFFERING OF SECURITIES MUST BE TERMINATED AND ALL CONSIDERATION RECEIVED MUST BE IMMEDIATELY RETURNED TO ALL SUBSCRIBERS.
Remarks:
(a) Underwriting
=
UNDERWRITING ARRANGEMENTS in relation to an offering of securities are at the discretion of the applicant and its principal adviser.
=
THE PRINCIPAL ADVISOR MUST BE PART OF the syndicate of underwriters for the securities offered under the initial public offering if there is an underwriting arrangement.
An applicant seeking listing on Bursa Securities MUST DISCLOSE IN ITS PROSPECTUS –
(a) THE MINIMUM LEVEL OF SUBSCRIPTION and THE BASIS FOR DETERMINING the minimum level based on factors, such as the level of funding required by the applicant and the extent of the shareholding spread needed; and
(b) THE LEVEL OF UNDERWRITING that has been arranged, together with justifications for the level arranged.
Where the minimum level of subscription IS NOT ACHIEVED, the offering of securities MUST BE TERMINATED and all consideration received MUST BE IMMEDIATELY RETURNED to all subscribers.
MORATORIUM
5.29 A MORATORIUM WILL BE IMPOSED ON THE SECURITIES OF THE APPLICANT HELD BY THE SHAREHOLDERS WHOSE SECURITIES ARE SUBJECT TO MORATORIUM, AS FOLLOWS:
(A) FOR LISTING UNDER THE PROFIT TEST OR MARKET CAPITALISATION TEST, THE SAID SHAREHOLDERS ARE NOT ALLOWED TO SELL, TRANSFER OR ASSIGN ANY OF THEIR HOLDINGS IN THE SECURITIES AS AT THE DATE OF LISTING ON BURSA SECURITIES, FOR SIX MONTHS FROM THE DATE OF THE LISTING;
(B) FOR LISTING UNDER THE INFRASTRUCTURE PROJECT CORPORATION TEST, THE SAID SHAREHOLDERS ARE NOT ALLOWED TO SELL, TRANSFER OR ASSIGN ANY OF THEIR HOLDINGS IN THE SECURITIES AS AT THE DATE OF LISTING ON BURSA SECURITIES. THE MORATORIUM WILL BE LIFTED IMMEDIATELY AT THE END OF SIX MONTHS AFTER THE DATE OF THE LISTING IF THE INFRASTRUCTURE PROJECT HAS GENERATED ONE FULL FINANCIAL YEAR OF AUDITED OPERATING REVENUE. FOR INFRASTRUCTURE PROJECT CORPORATION WHICH HAS YET TO GENERATE ONE FULL FINANCIAL YEAR OF AUDITED OPERATING REVENUE, THE SAID SHAREHOLDERS MUST RETAIN THEIR SHAREHOLDINGS AMOUNTING TO 45% OF THE TOTAL NUMBER OF ISSUED SHARES OF THE APPLICANT. UPON ACHIEVING ONE FULL FINANCIAL YEAR OF AUDITED OPERATING REVENUE, THE MORATORIUM ON THE 45% SHAREHOLDING WILL BE LIFTED; AND
(C) FOR AN MOG CORPORATION GRANTED RELIEF UNDER PARAGRAPH 5.37B, THE SAID SHAREHOLDERS OF THE MOG CORPORATION ARE NOT ALLOWED TO SELL, TRANSFER OR ASSIGN ANY OF THEIR HOLDINGS IN THE SECURITIES AS AT THE DATE OF LISTING ON BURSA SECURITIES. THIS MORATORIUM WILL BE LIFTED ONLY UPON THE MOG CORPORATION ACHIEVING ONE FULL FINANCIAL YEAR OF OPERATING REVENUE AND POSITIVE CASH FLOW FROM OPERATING ACTIVITIES, BASED ON AUDITED FINANCIAL STATEMENTS.
IN RELATION TO PARAGRAPHS 5.29(B) AND (C), THE SAID SHAREHOLDERS MUST MAKE AN APPLICATION TO THE SC FOR THE LIFTING OF THE MORATORIUM, DEMONSTRATING THAT THE CONDITIONS FOR SUCH LIFTING HAVE BEEN MET.
5.30 WHERE THE SHAREHOLDERS WHOSE SECURITIES ARE SUBJECT TO MORATORIUM ARE ENTITIES WHICH ARE NOT LISTED, ALL DIRECT AND INDIRECT HOLDERS OF THESE ENTITIES, IF THEY ARE INDIVIDUALS OR OTHER ENTITIES WHICH ARE NOT LISTED UP TO THE ULTIMATE INDIVIDUAL HOLDERS MUST GIVE AN UNDERTAKING TO THE SC THAT THEY WILL NOT SELL, TRANSFER OR ASSIGN ANY OF THEIR RESPECTIVE HOLDINGS IN THE ENTITIES WHICH ARE NOT LISTED FOR THE PERIOD AS STIPULATED IN PARAGRAPHS 5.29(A), (B) OR (C), AS APPLICABLE.
5.31 FOR PURPOSES OF PARAGRAPHS 5.29(A) AND (C), THE SHAREHOLDINGS OF SAID SHAREHOLDERS TO BE PLACED UNDER MORATORIUM MUST INCLUDE ALL SHARES IN THE APPLICANT ISSUED TO THE SAID SHAREHOLDERS DURING THE MORATORIUM PERIOD ARISING FROM THE CONVERSION OR EXERCISE OF ANY CONVERTIBLE SECURITIES OR WARRANTS HELD BY THE SAID SHAREHOLDERS AT THE DATE OF LISTING OF THE APPLICANT ON BURSA SECURITIES.
5.32 FOR PURPOSES OF PARAGRAPH 5.29(B), WHERE THE SAID SHAREHOLDERS ALSO OWN SECURITIES THAT ARE CONVERTIBLE OR EXERCISABLE INTO ORDINARY SHARES OF THE APPLICANT, THE SHAREHOLDINGS OF SAID SHAREHOLDERS TO BE PLACED UNDER MORATORIUM MUST AMOUNT TO 45% OF THE ENLARGED NUMBER OF ISSUED SHARES OF THE APPLICANT ASSUMING FULL CONVERSION OR EXERCISE OF SUCH SECURITIES OWNED BY THE SAID SHAREHOLDERS.
5.33 WHERE A PRICE STABILISATION MECHANISM UNDER THE CAPITAL MARKETS AND SERVICES (PRICE STABILIZATION MECHANISM) REGULATIONS 2008 IS INCLUDED IN THE LISTING PROPOSAL, THE SHAREHOLDERS WHOSE SECURITIES ARE SUBJECT TO MORATORIUM ARE ALLOWED TO TRANSFER THEIR MORATORIUM SECURITIES TO A DESIGNATED ACCOUNT HELD BY THE STABILISING MANAGER TO FACILITATE THIS PURPOSE.
Important Remarks:
(a) Moratorium
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5.29 A MORATOTIUM WILL BE IMPOSED on the securities of the applicant held by the shareholders whose securities ARE SUBJECT TO MORATOTIUM, as follows:
(a) For listing under the profit test or market capitalisation test, the said shareholders ARE NOT ALLOWED TO SELL, TRANSFER OR ASSIGN ANY OF THEIR HOLDINGS in the securities as at the date of listing on Bursa Securities, FOR 6 MONTHS FROM THE DATE OF LISTING;
(b) For listing under the IPC TEST, the said shareholders ARE NOT ALLOWED TO SELL, TRANSFER OR ASSIGN ANY OF THEIR HOLDINGS in the securities as at the date of listing on Bursa Securities. THE MORATORIUM WILL BE LIFTED IMMEDIATELY AT THE END OF 6 MONTHS after the date of the listing if the IP HAS GENERATED ONE FULL FINANCIAL YEAR of audited operating revenue. For IPC which has yet to generate one full financial year of audited operating revenue, the said shareholders MUST RETAIN THEIR SHAREHOLDINGS AMOUNTING TO 45% of the total number of issued shares of the applicant. UPON ACHIEVING ONE FULL FINANCIAL YEAR of audited operating revenue, the moratorium on the 45% shareholding will be lifted; and
(c) For an MOG corporation granted relief under paragraph 5.37B, the said shareholders of the MOG corporation ARE NOT ALLOWED TO SELL, TRANSFER OR ASSIGN ANY of their holdings in the securities as at the date of listing on Bursa Securities. This moratorium will be lifted only upon the MOG corporation achieving one full financial year of operating revenue and positive cash flow from operating activities, based on audited financial statements.
In relation to paragraphs 5.29(b) and (c), the said shareholders MUST MAKE AN APPLICATION to the SC for the lifting of the moratorium, demonstrating that the conditions for such lifting have been met.
5.30 Where the shareholders whose securities are subject to moratorium are entities which are not listed, all direct and indirect holders of these entities, if they are individuals or other entities which are not listed up to the ultimate individual holders must give an undertaking to the SC that THEY WILL NOT SELL, TRANSFER OR ASSIGN ANY of their respective holdings in the entities which are not listed for the period as stipulated in paragraphs 5.29(a), (b) or (c), as applicable.
5.31 For purposes of paragraphs 5.29(a) and (c), the shareholdings of said shareholders to be placed under moratorium MUST INCLUDE ALL SHARES in the applicant issued to the said shareholders during the moratorium period arising from the conversion or exercise of any convertible securities or warrants held by the said shareholders at the date of listing of the applicant on Bursa Securities.
5.32 For purposes of paragraph 5.29(b), where the said shareholders also own securities that are convertible or exercisable into ordinary shares of the applicant, the shareholdings of said shareholders to be placed under moratorium MUST AMOUNT TO 45% OF THE ENLARGED NUMBER OF ISSUED SHARES of the applicant assuming full conversion or exercise of such securities owned by the said shareholders.
5.33 Where a price stabilisation mechanism under the Capital Markets and Services (Price Stabilization Mechanism) Regulations 2008 is included in the listing proposal, the shareholders whose securities are subject to moratorium ARE ALLOWED TO TRANSFER their moratorium securities to a designated account held by the stabilising manager to facilitate this purpose.
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VALUATION
5.34 A VALUATION IS REQUIRED TO BE CONDUCTED FOR AN ACQUISITION OF PROPERTY ASSETS OR CORPORATIONS WHICH OWN PROPERTY ASSETS, WHERE THE REVALUED AMOUNT OF THE PROPERTY ASSETS IS USED, WHETHER WHOLLY OR PARTLY, AS THE BASIS FOR THE CONSIDERATION. THE REVALUED AMOUNT OF THE PROPERTY ASSETS IS THIS CONTEXT REFERS TO PROPERTY ASSETS WHICH ARE TO BE REVALUED OR HAVE BEEN REVALUED IN THE PAST PRIOR TO THE SUBMISSION TO THE SC.
5.35 NOTWITHSTANDING PARAGRAPH 5.34, A PROPERTY INVESTMENT OR PROPERTY DEVELOPMENT CORPORATION SEEKING LISTING ON BURSA SECURITIES MUST APPOINT AN INDEPENDENT VALUER TO CONDUCT A VALUATION OF ITS MATERIAL REAL ESTATE.
5.36 THE SC, WHENEVER IT DEEMS APPROPRIATE, MAY ALSO REQUIRE AN APPLICANT TO CONDUCT A VALUATION ON ANY ASSET OTHER THAN THOSE REFERRED TO IN PARAGRAPHS 5.34 AND 5.35. 5.37 THE SC MAY OBTAIN A SECOND OPINION ON THE VALUATION REPORT SUBMITTED BY THE APPLICANT. WHERE A SECOND OPINION VALUATION IS REQUIRED, THE VALUER CONDUCTING THE VALUATION HAS TO BE APPOINTED BY THE SC, AT THE COST OF THE APPLICANT AND THE LOWER OF THE TWO VALUATIONS MUST BE ADOPTED AS THE BASIS FOR THE PURCHASE CONSIDERATION.
Important Remarks:
(a) Valuation
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5.34 A VALUATION IS REQUIRED TO BE CONDUCTED to be conducted for an acquisition of property assets or corporations which own property assets, WHERE THE REVALUED AMOUNT of the property assets is used, whether WHOLLY OR PARTLY, AS THE BASIS FOR THE CONSIDERATION. The revalued amount of the property assets in this context refers to property assets which are to be revalued or have been revalued in the past prior to the submission to the SC.
5.35 Notwithstanding paragraph 5.34, a property investment or property development corporation seeking listing on Bursa Securities MUST APPOINT AN INDEPENDENT VALUER to conduct a valuation of its material real estate.
5.36 The SC, whenever it deems appropriate, MAY ALSO REQUIRE an applicant to conduct a valuation on ANY OTHER ASSET OTHER THAN those referred to in paragraphs 5.34 and 5.35. 5.37 The SC MAY OBTAIN a second opinion on the valuation report submitted by the applicant. Where A SECOND OPNION VALUATION IS REQUIRED, the valuer conducting the valuation HAS TO BE APPOINTED by the SC, at the cost of the applicant and the lower of the two valuations MUST BE ADOPTED as the basis for the purchase consideration.
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ADDITIONAL REQUIREMENTS FOR THE LISTING OF AN MOG CORPORATION
5.37A AN MOG CORPORATION SEEKING LISTING ON BURSA SECURITIES MUST COMPLY WITH THE FOLLOWING REQUIREMENTS:
(A) IT MUST HAVE AN ADEQUATE PORTFOLIO OF AT LEAST–
(I) IN THE CASE OF O&G, CONTINGENT RESOURCES; OR
(II) IN THE CASE OF MINERALS, INDICATED RESOURCES, WHICH MUST BE SUPPORTED BY A COMPETENT PERSON’S REPORT;
(B) FOR THE MAJORITY OF ITS MOG ASSETS, IN VALUE, THE MOG CORPORATION MUST HAVE–
(I) THE LEGAL RIGHTS FOR EXPLORATION OR EXTRACTION ACTIVITIES IN RESPECT OF THE MOG ASSETS; AND
(II) CONTROL OVER THE MOG ASSETS;
(C) IT MUST HAVE SUFFICIENT LEVEL OF WORKING CAPITAL FOR AT LEAST 18 MONTHS FROM THE DATE OF THE PROSPECTUS;
(D) IT MUST HAVE AT LEAST ONE INDEPENDENT DIRECTOR OUT OF THE REQUISITE NUMBER OF INDEPENDENT DIRECTORS, WITH THE APPROPRIATE MOG EXPLORATION OR EXTRACTION EXPERIENCE OR EXPERTISE;
(E) IT MUST HAVE, AS ITS EXTERNAL AUDITOR, AN AUDIT FIRM WHICH HAS RELEVANT MOG EXPLORATION OR EXTRACTION INDUSTRY EXPERTISE; AND
(F) FOR THE PURPOSES OF COMPLIANCE WITH CHAPTER 10 OF DIVISION 1, PART II OF THE PROSPECTUS GUIDELINES, IT MUST APPOINT A REPORTING ACCOUNTANT WHICH HAS RELEVANT MOG EXPLORATION OR EXTRACTION INDUSTRY EXPERTISE.
5.37B WHERE AN MOG CORPORATION IS UNABLE TO COMPLY WITH PARAGRAPHS 5.02(B)(II) OR 5.08(B) WHEN LISTING IS SOUGHT VIA THE MARKET CAPITALISATION TEST, THE SC MAY CONSIDER GRANTING THE APPLICANT RELIEF FROM SUCH REQUIREMENTS IF THE APPLICANT IS ABLE TO DEMONSTRATE THAT–
(A) IT HAS CLEAR PLANS TO ADVANCE THE MOG ASSETS TO COMMERCIAL PRODUCTION WITHIN TWO YEARS. SUCH PLANS, TOGETHER WITH MILESTONES AND RELATED EXPENDITURES, MUST BE REVIEWED AND SUPPORTED BY A COMPETENT PERSON AND PROVIDED IN THE PROSPECTUS;
(B) IT HAS SUFFICIENT FUNDS TO UNDERTAKE SUCH PLANS UNDER PARAGRAPH 5.37B(A); AND
(C) ITS DIRECTORS AND MANAGEMENT COLLECTIVELY HAVE SUFFICIENT MOG EXPLORATION OR EXTRACTION EXPERIENCE TO EFFECTIVELY IMPLEMENT SUCH PLANS UNDER PARAGRAPH 5.37B(A).
Important Remarks:
(a) Additional requirements for the listing of an MOG corporation
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5.37A An MOG corporation seeking listing on Bursa Securities must comply with the following requirements:
(a)IT MUST HAVE an adequate portfolio of at least–
(i) in the case of O&G, Contingent Resources; or
(ii) in the case of minerals, Indicated Resources, which MUST BE SUPPORTED by a competent person’s report;
(b) For the majority of its MOG assets, in value, the MOG corporation MUST HAVE–
(i) THE LEGAL RIGHT FOR EXPLORATION or EXTRACTION activities in respect of the MOG assets; and
(ii) CONTROL OVER the MOG assets;
(c) IT MUST HAVE sufficient level of working capital for at least 18 months from the date of the prospectus;
(d) IT MUST HAVE at least one independent director out of the requisite number of independent directors, with the appropriate MOG exploration or extraction experience or expertise;
(e) II MUST HAVE, as its external auditor, an audit firm which has relevant MOG exploration or extraction industry expertise; and
(f) For the purposes of compliance with Chapter 10 of Division 1, Part II of the Prospectus Guidelines, it must appoint a reporting accountant which has relevant MOG exploration or extraction industry expertise.
5.37B Where an MOG corporation is UNABLE TO COMPLY WITH paragraphs 5.02(b)(ii) or 5.08(b) when listing is sought via the MCAP TEST, the SC MAY CONSIDER granting the applicant relief from such requirements if the applicant is able to demonstrate that–
(a) IT HAS CLEAR PLANS to advance the MOG assets to commercial production WITHIN 2 YEARS. Such plans, together with milestones and related expenditures, MUST BE RECEIVED AND SUPPORTED by a competent person and provided in the prospectus;
(b) IT HAS SUFFICIENT DUNDS to undertake such plans under paragraph 5.37B(a); and
(c) ITS DIRECTORS AND MANAGEMENT COLLECTIVELY HAVE sufficient MOG exploration or extraction experience to effectively implement such plans under paragraph 5.37B(a).
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STANDARDS OF LAWS AND REGULATIONS
5.38 A FOREIGN CORPORATION SEEKING LISTING ON BURSA SECURITIES MUST BE INCORPORATED IN A JURISDICTION THAT IS SUBJECT TO CORPORATION LAWS AND OTHER LAWS AND REGULATIONS WHERE APPROPRIATE WHICH HAVE STANDARDS AT LEAST EQUIVALENT TO THOSE IN MALAYSIA, PARTICULARLY WITH RESPECT TO–
(A) CORPORATE GOVERNANCE;
(B) SHAREHOLDERS AND MINORITY INTEREST PROTECTION; AND
(C) REGULATION OF TAKE-OVERS AND MERGERS.
5.39 WHERE THE JURISDICTION IN WHICH THE APPLICANT IS INCORPORATED DOES NOT PROVIDE STANDARDS OF CORPORATE GOVERNANCE, SHAREHOLDERS’ AND MINORITY INTEREST PROTECTION, AND REGULATION OF TAKE-OVERS AND MERGERS AT LEAST EQUIVALENT TO THOSE PROVIDED IN MALAYSIA, BUT IT IS POSSIBLE TO PROVIDE THOSE STANDARDS BY MEANS OF VARYING THE APPLICANT’S CONSTITUENT DOCUMENTS, THE SC MAY CONSIDER THE LISTING OF THE APPLICANT, SUBJECT TO THE APPLICANT MAKING SUCH VARIATIONS TO ITS CONSTITUENT DOCUMENTS. IN RELATION TO THIS, THE APPLICANT MUST SUBMIT A COMPARISON OF SUCH STANDARDS OF LAWS AND REGULATIONS OF THE JURISDICTION IN WHICH THE APPLICANT IS INCORPORATED AND THOSE PROVIDED IN MALAYSIA, TOGETHER WITH THE PROPOSED VARIATIONS TO ITS CONSTITUENT DOCUMENTS TO ADDRESS ANY DEFICIENCY IN SUCH STANDARDS, IN ITS LISTING APPLICATIONS TO THE SC AND BURSA SECURITIES.
5.40 THE SECURITIES OF THE APPLICANT MUST BE VALIDLY ISSUED IN ACCORDANCE WITH THE CONSTITUENT DOCUMENTS OF THE APPLICANT AND THE RELEVANT LAWS IN FORCE IN THE COUNTRY OF INCORPORATION OF THE APPLICANT.
Remarks:
(a) Additional requirements for FOREIGN CORPORATION
5.39 Where the jurisdiction in which the applicant IS INCORPORATED DOES NOT PROVIDE standards of corporate governance, shareholders’ and minority interest protection, and regulation of take-overs and mergers at least equivalent to those provided in Malaysia, BUT IT IS POSSIBLE to provide those standards by means of varying the applicant’s constituent documents, the SC may consider the listing of the applicant, subject to the applicant making such variations to its constituent documents. In relation to this, the applicant MUST SUBMIT a comparison of such standards of laws and regulations of the jurisdiction in which the applicant is incorporated and those provided in Malaysia, TOGETHER WITH the proposed variations to its constituent documents to address any deficiency in such standards, in its listing applications to the SC and Bursa Securities.
5.40 The securities of the applicant MUST BE VALIDLY ISSUED in accordance with the constituent documents of the applicant and the relevant laws in force in the country of incorporation of the applicant.
APPROVAL OF REGULATORY AUTHORITIES OF FOREIGN JURISDICTION
5.41 THE APPLICANT MUST OBTAIN THE APPROVAL OF ALL RELEVANT REGULATORY AUTHORITIES OF THE JURISDICTION IN WHICH IT IS INCORPORATED AND CARRIES OUT ITS CORE BUSINESS, AS MAY BE REQUIRED, BEFORE ISSUING ITS PROSPECTUS.
REGISTRATION UNDER COMPANIES ACT 2016
5.42 THE APPLICANT MUST HAVE BEEN REGISTERED AS A FOREIGN COMPANY UNDER THE COMPANIES ACT 2016.
5.43 [DELETED]
5.44 [DELETED]
5.45 [DELETED]
CURRENCY DENOMINATION
5.46 THE APPLICANT IS TO CONSULT BURSA SECURITIES AND OBTAIN THE APPROVAL OF THE BANK NEGARA MALAYSIA IF IT PREFERS ITS SECURITIES TO BE QUOTED IN A CURRENCY OTHER THAN RINGGIT MALAYSIA.
APPROVAL OF CONTROLLER OF FOREIGN EXCHANGE
5.47 THE APPLICANT OR THE OFFERORS OF THE SECURITIES IN THE APPLICANT MUST, WHERE APPLICABLE, OBTAIN THE PRIOR APPROVAL OF BANK NEGARA MALAYSIA FOR THE UTILISATION OF PROCEEDS FROM THE OFFERING OF SECURITIES.
RESIDENT DIRECTORS
5.48 AN APPLICANT WHOSE OPERATIONS ARE ENTIRELY OR PREDOMINANTLY MALAYSIAN-BASED MUST HAVE A MAJORITY OF DIRECTORS WHOSE PRINCIPAL OR ONLY PLACE OF RESIDENCE IS WITHIN MALAYSIA.
5.49 AN APPLICANT WHOSE OPERATIONS ARE ENTIRELY OR PREDOMINANTLY FOREIGN-BASED MUST HAVE AT LEAST TWO DIRECTORS WHOSE PRINCIPAL OR ONLY PLACE OF RESIDENCE IS WITHIN MALAYSIA. AT LEAST ONE OF THESE DIRECTORS MUST BE A MEMBER OF THE APPLICANT’S AUDIT COMMITTEE.
PART B: SECONDARY LISTING OF A FOREIGN CORPORATION ON BURSA SECURITIES
5.50 IN ADDITION TO COMPLYING WITH ALL THE REQUIREMENTS FOR THE LISTING OF A FOREIGN CORPORATION AS SET OUT IN PARAGRAPHS 5.38 TO 5.49, A FOREIGN CORPORATION SEEKING A SECONDARY LISTING ON BURSA SECURITIES MUST COMPLY WITH THE FOLLOWING:
(A) THE APPLICANT MUST ALREADY HAVE A PRIMARY LISTING ON THE MAIN MARKET OF A SECURITIES EXCHANGE OUTSIDE OF MALAYSIA WHICH IS SPECIFIED BY THE SC AND BE IN FULL COMPLIANCE WITH THE LISTING RULES OF THE SAID SECURITIES EXCHANGE; AND
(B) THE SECURITIES EXCHANGE WHERE THE APPLICANT IS PRIMARILY LISTED MUST HAVE STANDARDS OF DISCLOSURE RULES AT LEAST EQUIVALENT TO THOSE OF BURSA SECURITIES.
5.51 [DELETED]
5.52 [DELETED]
5.53 [DELETED]
6.01 THIS CHAPTER SETS OUT THE REQUIREMENTS FOR THE FOLLOWING PROPOSALS:
(A) EQUITY OFFERING AND PRIMARY LISTING OF A SPAC ON BURSA SECURITIES;
(B) QUALIFYING ACQUISITION BY A SPAC; AND
(C) LIQUIDATION DISTRIBUTION UPON FAILURE BY A SPAC TO MEET TIME FRAME FOR A QUALIFYING ACQUISITION.
6.02 IN THIS CHAPTER, UNLESS THE CONTEXT OTHERWISE REQUIRES–
COMPLETION OF QUALIFYING ACQUISITION -
MEANS THE POINT OF TIME WHERE UPON ALL CONDITIONS PRECEDENT SET OUT IN ANY AGREEMENT GOVERNING THE QUALIFYING ACQUISITION HAVE BEEN FULFILLED;
MANAGEMENT TEAM
MANAGEMENT TEAM INCLUDES THE EXECUTIVE DIRECTORS AND MEMBERS OF THE SENIOR MANAGEMENT OF THE SPAC WHO ARE INVOLVED IN MAKING STRATEGIC DECISIONS IN THE SPAC;
PERMITTED INVESTMENTS
MEANS INVESTMENTS IN SECURITIES ISSUED BY THE MALAYSIAN GOVERNMENT, MONEY MARKET INSTRUMENTS AND AAA-RATED PAPERS;
PERMITTED TIME FRAME
MEANS NO LATER THAN 36 MONTHS FROM THE DATE OF LISTING OF THE SPAC ON BURSA SECURITIES;
PPRE-IPO INVESTORS
MEANS PARTIES, OTHER THAN MEMBERS OF THE MANAGEMENT TEAM, WHO INVEST IN THE SECURITIES OF THE SPAC PRIOR TO THE INITIAL PUBLIC OFFERING
TRUST ACCOUNT
MEANS A TRUST ACCOUNT MAINTAINED WITH A LICENSED BANK OR INVESTMENT BANK AS DEFINED IN THE FINANCIAL SERVICES ACT 2013 BY A CUSTODIAN APPOINTED BY THE SPAC TO HOLD ON ITS BEHALF, PROCEEDS FROM AN ISSUANCE OF SECURITIES BY THE SPAC; VOTING SHARES MEANS THE SHARES ISSUED BY A SPAC WHICH CONFER UPON THE HOLDERS VOTING RIGHTS..
VOTING SHARES
MEANS THE SHARES ISSUED BY A SPAC WHICH CONFER UPON THE HOLDERS VOTING RIGHTS..
Important Remarks:
What is a SPAC?
A SPAC is basically a shell company that has no operations but goes public with
the intention of merging with or acquiring operating companies or businesses
with its IPO proceeds.
SPACs could be used as a vehicle to promote private equity activities and
encourage corporate mergers and acquisitions.
(a) Special Purpose Acquisition Company (SPAC)
PART A:
EQUITY OFFERING AND PRIMARY LISTING OF A SPAC ON BURSA
SECURITIES
SUITABILITY FOR LISTING
6.03 THE SC WILL CONSIDER THE SUITABILITY FOR LISTING OF A SPAC ON A CASE BY CASE BASIS. THE SC MAY, IN ITS ASSESSMENT, TAKE INTO ACCOUNT ANY FACTOR IT CONSIDERS RELEVANT INCLUDING, BUT NOT LIMITED TO, THE FOLLOWING:
(A) EXPERIENCE AND TRACK RECORD OF THE MANAGEMENT TEAM;
(B) NATURE AND EXTENT OF THE MANAGEMENT TEAM’S COMPENSATION;
(C) EXTENT OF THE MANAGEMENT TEAM’S OWNERSHIP IN THE SPAC;
(D) AMOUNT OF TIME PERMITTED FOR COMPLETION OF THE QUALIFYING ACQUISITION PRIOR TO THE MANDATORY DISSOLUTION OF THE SPAC;
(E) PERCENTAGE OF AMOUNT HELD IN THE TRUST ACCOUNT THAT MUST BE REPRESENTED BY THE FAIR MARKET VALUE OF THE QUALIFYING ACQUISITION; AND
(F) PERCENTAGE OF PROCEEDS FROM THE INITIAL PUBLIC OFFERING THAT IS PLACED IN THE TRUST ACCOUNT. 6.03 A IN DEMONSTRATING THE SUITABILITY OF A SPAC FOR LISTING UNDER PARAGRAPH 6.03, THE PRINCIPAL ADVISER MUST CONSIDER THE SPAC PROPOSAL HOLISTICALLY AND TAKE INTO CONSIDERATION THAT SUCH FACTORS ARE ALIGNED TO THE FOLLOWING:
(A) THE BUSINESS OBJECTIVE AND STRATEGY OF THE SPAC; AND
(B) THE POTENTIAL RETURNS TO INVESTORS.
6.03B A SPAC LISTING PROPOSAL MUST BE STRUCTURED IN A MANNER THAT ENSURES THE INTEREST OF THE MANAGEMENT TEAM IS ALIGNED WITH THE INTEREST OF PUBLIC INVESTORS.
6.04 [MOVED TO PARAGRAPH 6.09A]
Important Remarks:
URISDICTION OF INCORPORATION
6.05 A SPAC SEEKING LISTING ON BURSA SECURITIES MUST BE INCORPORATED IN MALAYSIA UNDER THE COMPANIES ACT 2016.
Important Remarks:
METHODS OF OFFERING OF SECURITIES
6.06 THE METHODS OF OFFERING OF SECURITIES CHOSEN BY A SPAC MUST COMPLY WITH THE REQUIREMENTS SET OUT IN PARAGRAPH 5.14.
6.07 ANY PUBLIC OFFERING OF SECURITIES BY A SPAC FOR PURPOSES OF SEEKING LISTING ON BURSA SECURITIES MUST ONLY BE MADE THROUGH AN ISSUE OF NEW SECURITIES. AN OFFER FOR SALE OF SECURITIES IS NOT ALLOWED.
Important Remarks:
PLACEMENT OF SECURITIES
6.08 IN UNDERTAKING A PLACEMENT OF SECURITIES, THE SPAC MUST COMPLY WITH THE REQUIREMENTS SET OUT IN PARAGRAPHS 5.19 AND 5.20.
Important Remarks:
MINIMUM FUNDS RAISED
6.09 A SPAC MUST RAISE A MINIMUM OF RM100 MILLION THROUGH ITS INITIAL PUBLIC OFFERING. NOTWITHSTANDING THIS MINIMUM REQUIREMENT, A SPAC MUST DEMONSTRATE THAT THE GROSS PROCEEDS TO BE RAISED FROM THE INITIAL PUBLIC OFFERING WOULD BE SUFFICIENT TO UNDERTAKE A QUALIFYING ACQUISITION.
6.09A A LISTING APPLICATION BY A SPAC MUST COMPLY WITH THE REQUIREMENTS ON PRICING OF SECURITIES AND UNDERWRITING SET OUT IN PARAGRAPHS 5.24 TO 5.28 AS WELL AS THE REQUIREMENTS SET OUT IN THIS CHAPTER.
6.09B THE ISSUE PRICE OF SHARES OFFERED FOR SUBSCRIPTION, FOR WHICH A LISTING IS SOUGHT, MUST BE AT LEAST RM2.00 EACH.
Important Remarks:
PRICING OF SECURITIES
6.10 THE MINIMUM EFFECTIVE PRICE OF SECURITIES ISSUED TO THE MANAGEMENT TEAM MUST BE AT LEAST 10% OF THE PRICE AT WHICH THE SECURITIES ARE OFFERED UNDER THE INITIAL PUBLIC OFFERING.
6.11 THE MINIMUM EFFECTIVE PRICE OF SECURITIES ISSUED TO PRE-IPO INVESTORS PRIOR TO THE INITIAL PUBLIC OFFERING MUST BE AT LEAST 60% OF THE PRICE AT WHICH THE SECURITIES ARE OFFERED UNDER THE INITIAL PUBLIC OFFERING.
Important Remarks:
ISSUANCE OF WARRANTS
6.12 IN ADDITION TO FULL COMPLIANCE WITH THE MAIN MARKET LISTING REQUIREMENTS, WHERE WARRANTS ARE ISSUED AS PART OF A SPAC’S LISTING SCHEME–
(A) THERE SHOULD ONLY BE ONE CLASS OF WARRANTS AND THE EXERCISE PRICE OF WARRANTS MUST NOT BE LOWER THAN THE PRICE OF THE ORDINARY SHARES OFFERED UNDER THE INITIAL PUBLIC OFFERING;
(B) THE WARRANTS MUST NOT BE EXERCISABLE PRIOR TO THE COMPLETION OF THE QUALIFYING ACQUISITION;
(C) THE WARRANTS MUST EXPIRE ON THE EARLIER OF EITHER THE MAXIMUM TENURE UNDER THE TERMS OF THE ISSUE OR THE TIME FRAME FOR COMPLETION OF A QUALIFYING ACQUISITION, IF NO ACQUISITION IS COMPLETED;
(D) THE WARRANTS ARE NOT TO HAVE AN ENTITLEMENT TO THE FUNDS HELD IN THE TRUST ACCOUNT UPON LIQUIDATION OF THE SPAC; AND
(E) THE NUMBER OF NEW SHARES WHICH WILL ARISE FROM THE EXERCISE OF THE WARRANTS MUST NOT EXCEED 50% OF THE ENLARGED NUMBER OF ISSUED SHARES OF THE SPAC.
Important Remarks:
EXPERIENCE AND TRACK RECORD OF THE MANAGEMENT TEAM
6.13 A SPAC MUST DEMONSTRATE THAT THE MEMBERS OF ITS MANAGEMENT TEAM HAVE THE EXPERIENCE, QUALIFICATION AND COMPETENCE TO –
(A) ACHIEVE THE SPAC’S BUSINESS OBJECTIVE AND STRATEGY AS DISCLOSED IN THE PROSPECTUS ISSUED IN RELATION TO THE INITIAL PUBLIC OFFERING; AND
(B) PERFORM THEIR INDIVIDUAL ROLES, INCLUDING AN UNDERSTANDING OF THE NATURE OF THEIR OBLIGATIONS AND THOSE OF THE SPAC UNDER THESE GUIDELINES AND OTHER LEGAL OR REGULATORY REQUIREMENTS RELEVANT TO THEIR ROLES.
6.13A THE SPAC MANAGEMENT TEAM, AS A WHOLE, MUST POSSESS THE APPROPRIATE EXPERIENCE AND TRACK RECORD WHICH DEMONSTRATE THAT IT WILL BE CAPABLE OF IDENTIFYING AND EVALUATING THE TARGET BUSINESS, COMPLETING THE QUALIFYING ACQUISITION AND MANAGING THE COMPANY SUSTAINABLY BASED ON THE BUSINESS STRATEGY OUTLINED IN THE PROSPECTUS. THE PRINCIPAL ADVISER MUST DEMONSTRATE THAT THE MANAGEMENT TEAM HAS GOOD CORPORATE GOVERNANCE AND REGULATORY COMPLIANCE HISTORY, AS WELL AS THE REQUISITE COLLECTIVE EXPERIENCE AND TRACK RECORD, WHICH INCLUDE HAVING–
(A) SUFFICIENT AND RELEVANT TECHNICAL AND COMMERCIAL EXPERIENCE AND EXPERTISE;
(B) RELEVANT EXPERIENCE AS –
(I) DIRECTORS OR KEY MANAGEMENT OF CORPORATIONS LISTED ON A STOCK EXCHANGE OR A SECURITIES EXCHANGE OUTSIDE MALAYSIA WITH STANDARDS AT LEAST EQUIVALENT TO THOSE OF BURSA SECURITIES; OR
(II) PROFESSIONALS WITH PRIVATE EQUITY OR VENTURE CAPITAL BACKGROUND;
(C) POSITIVE TRACK RECORD IN CORPORATIONS WITHIN THE SAME INDUSTRY AND BUSINESS ACTIVITY EVIDENCED BY A MANAGEMENT TEAM MEMBER’S CONTRIBUTION TO THE GROWTH AND PERFORMANCE OF SUCH CORPORATIONS, INCLUDING ABILITY TO DEAL WITH THE RELEVANT RISKS RELATING TO THE BUSINESS OPERATIONS; OR
(D) ABILITY TO LOCATE AND DEVELOP APPROPRIATE MERGER AND ACQUISITION OPPORTUNITIES FOR CORPORATIONS.
(E) [DELETED]
6.13B A SPAC INTENDING TO ACQUIRE MOG ASSETS MUST HAVE AT LEAST ONE INDEPENDENT DIRECTOR, OUT OF THE REQUISITE NUMBER OF INDEPENDENT DIRECTORS, WITH THE APPROPRIATE MOG EXPLORATION OR EXTRACTION EXPERIENCE OR EXPERTISE AT THE POINT OF LISTING.
Important Remarks:
EXPERIENCE AND TRACK RECORD OF THE MANAGEMENT TEAM
PART III: SUBMISSION AND IMPLEMENTATION
CHAPTER 9
SUBMISSION OF PROPOSALS MINIMUM INFORMATION AND DOCUMENTS
9.01 AN APPLICATION OF ANY PROPOSAL UNDER THESE GUIDELINES MUST BE ACCOMPANIED BY THE RELEVANT INFORMATION AND DOCUMENTS AS SPECIFIED IN THE APPENDICES.
9.02 THE APPLICATION MUST INCLUDE THE RELEVANT DECLARATION BY THE APPLICANT, THE DIRECTORS AND PROPOSED DIRECTORS OF THE APPLICANT, AND ALL OTHER SPECIFIED PERSONS, IN ACCORDANCE WITH PART V.
9.02A THE SC MAY RETURN ANY APPLICATION WHICH IS DEEMED UNSATISFACTORY OR WHICH DO NOT COMPLY WITH THE REQUIREMENTS OF THE SC.
9.02B ANY APPLICATION FOR RELIEF FROM COMPLYING WITH THE REQUIREMENTS OF THESE GUIDELINES MUST BE SUBMITTED TO THE SC AT LEAST 14 MARKET DAYS PRIOR TO THE SUBMISSION OF THE APPLICATION FOR THE PROPOSAL.
9.02C FOR PURPOSES OF THE PROPOSALS REFERRED TO IN PARAGRAPH 1.10(A) AND (B), A PRELIMINARY APPLICATION PACK MUST BE SUBMITTED TO THE SC AT LEAST ONE MONTH PRIOR TO THE SUBMISSION OF THE APPLICATION FOR THE PROPOSAL. THE PRELIMINARY APPLICATION PACK MUST BE PREPARED IN ACCORDANCE WITH THE FORM AND CONTENT AS SPECIFIED BY THE SC.
9.02D FOR PURPOSE OF PARAGRAPH 9.02C, IF THE SUBMISSION OF THE APPLICATION FOR THE PROPOSAL IS NOT MADE WITHIN 3 MONTHS, A NEW PRELIMINARY APPLICATION PACK MUST BE SUBMITTED TO THE SC.
9.03 [DELETED]
Important Remarks:
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Reference:
Listing criteria
Bursa Malaysia offers a choice of three markets to companies seeking for listing in Malaysia:
(a) Main Market is a prime market for established companies that have met the standards in terms of quality, size and operations. Potential issuers for the Main Market must demonstrate that they have achieved minimum profit track record or minimum size measured by market capitalization;
(b) ACE Market is a sponsor-driven market designed for companies with growth prospects. It was formerly known as the MESDAQ Market prior to 3 August 2009. Sponsors must assess suitability of the potential issuers, taking into consideration attributes such as business prospects, corporate conduct and adequacy of internal control.
Main Market and ACE Market provide companies with greater visibility via the capital market and a clearly defined platform to raise funds from both institutional and retail investors; and
(c) LEAP Market is an adviser-driven market which aims to provide emerging companies, including small- and medium-sized enterprises with greater fund raising access and visibility via the capital market. It is accessible only to sophisticated investors (as prescribed under the Capital Markets and Services Act 2007).
Additional Reading...
Note: For SIDC Module 19 examination - Chapter 1, 2, 4B and 7 (Excluded)
