Bursa Malaysia Berhad (“Bursa Malaysia” or “the Exchange”) today officially welcomed the listing of Business Trusts (BT), an alternative listing structure that facilitates capital raising by listed entities seeking an Initial Public Offering (IPO) on Bursa Malaysia. This was demonstrated by the debut listing of Prolintas Infra BT, marking the first BT listed on the Exchange’s Main Market, and a Shariah-compliant BT, this morning.
Introduced under the Securities Commission Malaysia’s (SC) Business Trusts Guidelines (BT Guidelines) 2012, a BT is a hybrid investment structure that blends features of both an investment trust and a company. Essentially, it operates as a unit trust scheme established by a trust deed, wherein a trustee-manager oversees the operation and management of the scheme's assets. Unit holders in a BT have the opportunity to share in the profits or income generated by these assets through distributions declared by the trustee-manager. BTs undertaking an IPO are destined for the Main Market which require SC’s approval, before they are admitted to the Exchange for listing.
Datuk Muhamad Umar Swift, Chief Executive Officer of Bursa Malaysia said, “Business Trusts (BTs) provide a novel listing structure to raise capital that can facilitate development in our economy by making infrastructure-type projects more accessible to a broader range of investors, fostering growth and innovation across more capital intensive sectors. The listing of Prolintas Business Trust on our Exchange today exemplifies the successful implementation of the framework by the SC, and we look forward to more BTs following suit.”
A significant advantage of a BT is that dividend distributions of a BT can be made to investors from its operating cash flow, without being constrained by conventional accounting profits. Therefore, it is anticipated that a BT will be more attractive for business assets that are capital intensive but with stable cash flows – among others such as those in the infrastructure, telecommunications, and energy sectors, which support key national growth policies and roadmaps.
“At Bursa Malaysia, we continue to undertake efforts to make listing on the Exchange more appealing. One way to accomplish this is to diversify or expand into new asset classes, which opens up more opportunities. The introduction of the BT model expands the breadth of Malaysia’s capital market and demonstrates capital market regulators earnestness in providing facilitative frameworks and solutions. This development will augment the ability of the Exchange to play its role in facilitating growth plans of listed issuers, to benefit our economy at large. It is also our hope that this will in turn enhance the overall competitiveness of the Exchange,” Datuk Muhamad Umar Swift added.
