Corporate Requirements to Entitle Entities to List in Main Market, Malaysia - Bursa

This is a brief introduction to the unified board of bothas follows:-
Main Board and Second Board companies under the
Main Market.1. LR states that a listed issuer must ensure that the
There is a need for Malaysia to enhance itspublic shareholding spread is at least 25% of its total
competitiveness and to strengthen its position as ashares issued. However, compliance with at least 1,000
conducive capital raising destination. Addressing thispublic shareholders holding not less than 100 shares
issue, Securities Commission ("SC") collaborated witheach is waived with immediate effect. Further, there is
Bursa Malaysia ("Bursa") to review the listings andno need for application for extension of time for this
equity-raising framework. This enhancement entails thewaiver.
merging of the current Main Board and Second Board2. Existing PN16 and PN17 companies must continue to
into a single board of established corporations.comply with its obligations under the LR. However,
Effective 3 August 2009, this merged market of Mainthey may apply to Bursa to regularize their conditions
and Second Boards will be known as the Main Market,under the MMLR, provided that they are still within the
hence the listing of both Boards.stipulated or extended timeframe granted by Bursa.
Under the enhanced framework, changes will be madeFurther to the above, a listed issuer must submit a
to the Capital Markets and Services Act 2007valuation report to Bursa under the following
("CMSA") and the regulatory functions of both SC andcircumstances:-
Bursa will be streamlined, such as:-Where a transaction involving an acquisition or disposal
of any real estate as follows:-
1. SC's approval is required only for initial public- For non-related party transaction, any one of the
offerings, reverse takeover, back-door listings,percentage ratios is 25% or more;
secondary listings, cross listings and transfer of listings.- For related party transaction, any one of the
This allows SC to continue to function as thepercentage ratios is 5% or more.
gate-keeper to safeguard investor's interests;Irrespective of whether the consideration is satisfied
2. Secondary fund raising exercises such as rightsby way of cash or issuance of securities; and when
issues, placements and issuing of securities that do notthe listed issuer makes a two-call rights issue or bonus
change the core business of the listed companies shallissue of securities by capitalizing the reserves arising
require Bursa's approval. SC's approval is no longerfrom the revaluation of assets.
required.The valuation report must be submitted to Bursa
The main purpose of this enhanced framework with itstogether with any:-
streamlined processes and rules is to bring greater- Circular to Bursa or its shareholders for the relevant
certainty, shorter time-to-market and lower regulatorytransaction or proposal; or
costs.- Additional listing applications where the transaction or
Effective 3 August 2009, a listed issuer who carriedproposal involves a new issue of securities.
out secondary issuance of securities is required toThe above valuation report applied to those
submit the listing application to Bursa. However, whereapplications submitted to Bursa on or after 3 August
an issuance of securities creates a significant change2009. This is regardless of the date the listed issuer
in the business direction or policy of the listed issuer,announces the transaction or proposal.
SC's approval is required before submitting theFor avoidance of doubt, under the MMLR, if the
application to Bursa.valuation report is required to be submitted to SC, the
In order for a smooth transition to the Main Marketlisted issuer need not submit the valuation report to
Listing Requirement ("MMLR"), compliance with someBursa.
of the existing Listing Requirements ("LR") is modified