Bursa Malaysia Berhad (“Bursa Malaysia” or the “Exchange”) has reviewed the Main Market and ACE Market Listing Requirements (collectively “Listing Requirements”) to reflect, among others, the policy considerations for the acceptance of a lower public spread (“Public Spread Amendments”). Currently, the Listing Requirements prescribes that a listed issuer/applicant must have at least 25% of shares/units in the hands of the public[1].
Maintaining an appropriate level of public security holding spread is essential to provide sufficient liquidity in the market. Under the Public Spread Amendments, the Exchange will consider an application for a lower public spread based on a balanced assessment, comprising both quantitative and qualitative criteria as described below:
- The size and level of liquidity of an applicant or listed issuer through the following market capitalisation criteria:
|
Market Capitalisation[2] |
Acceptable Minimum Lower Public Spread |
|
RM1 billion or more but less than RM3 billion |
20% |
|
RM3 billion or more |
15% |
- The appropriateness and rationale of the application, including if there is sufficiency of liquidity, orderliness of trading of the securities, good corporate governance conduct and compliance records of the listed issuer/applicant and its directors, as well as reasonable justification necessitating the lower public spread.
The Public Spread amendments will promote greater transparency, as well as regulatory clarity and certainty on the policy considerations by the Exchange in accepting a lower public spread.
Notwithstanding the above, eligible listed issuers, and those granted with a lower public spread are strongly encouraged to maintain at least 25% public spread to promote wider participation of investors and a more liquid market.
The Public Spread Amendments will take effect from 1 March 2021.
Further information on the Public Spread Amendments are available on Bursa Malaysia’s website at:
- https://www.bursamalaysia.com/regulation/listing_requirements/main_market/amendments_to_listing_requirements
- https://www.bursamalaysia.com/regulation/listing_requirements/ace_market/amendments_to_listing_requirements
[1] Paragraph/Rule 8.02(1) and paragraph 3.06(1)/Rule 3.10(1) of the Listing Requirements.
[2] If the application for lower public spread is made prior to admission, the market capitalisation is to be based on the expected market capitalisation of the applicant as at the date of the listing application. If the application is made post-listing, the market capitalisation is the average market capitalisation calculated based on the daily closing price of the listed issuer’s securities during the 12-month period preceding the application to the Exchange.
