PETALING JAYA: The Securities Commission (SC) has revised its guidelines for the special-purpose acquisition firm (SPAC) framework in a bid for larger entry to fundraising in Malaysia.
This got here three months after Singapore introduced new guidelines that allow SPACs to record on the Singapore Exchange.
SPACs, dubbed money shells or blank-cheque corporations, are fashioned by a gaggle of people to lift funds by way of an preliminary public providing (IPO) with the aim of utilizing the proceeds to amass property or companies, also called a qualifying acquisition (QA).
In a press release yesterday, the SC stated the revision to the SPAC guideline was a part of its ongoing efforts to advertise the event of the Malaysian capital market.
“The SC re-evaluated the SPAC framework to ensure that it remains relevant and capable of spurring interest in listings and deals involving SPACs, thereby providing issuers with greater access to the capital market,” stated SC chairman Datuk Syed Zaid Albar.
The evaluation of the SPAC framework is in keeping with the Capital Market Masterplan 3 aspiration to create a capital market that’s related, environment friendly and diversified.
The revisions embody enabling enterprise combos through the issuance of securities as consideration for a QA. Under the present guidelines, SPACs might solely meet the QA requirement by the use of money acquisitions. The new guidelines can even broaden the avenue for SPACs to acquire extra financing by permitting personal placements for QAs.
However, the SC has decreased the minimal quantity of funds required to be raised by a SPAC by way of its IPO from RM150mil to RM100mil.
The new guideline can even permit professionals with in depth expertise in personal fairness and enterprise capital with asset sourcing and deal making expertise to steer SPACs.
To minimise the greenmail concern confronted by SPACs prior to now, the brink for shareholders’ approval of the QA has been decreased from a particular decision of at the very least 75% majority to a easy majority approval by all shareholders current and voting.
To mirror the inherent dangers of investing in SPACs, the minimal IPO value has been raised from 50 sen to RM2.00 to make sure that it attracts buyers who’re ready and prepared to tackle the distinctive dangers related to investing in SPACs, the SC stated.
“While the Malaysian capital market has seen new development and innovation, the SC would like to remind investors that SPACs are an alternative capital market investment option that may carry higher investment risk when compared with shares of listed corporations with operating businesses. Investors should familiarise themselves with the nature of SPACs and consider whether the investment meets their objectives and risk profile,” the SC stated.
The revised SPAC framework will take impact on Jan 1, 2022.
