With MESDAQ joining the KLSE Group, the merger of exchanges into a single Malaysian exchange as recommended in the Capital Market Masterplan (CMP) will move a step closer to fruition.
KLSE Executive Chairman Dato' Mohd Azlan Hashim said the consolidation into a single Malaysian exchange would hasten benefits not only to KLSE and MESDAQ, but will benefit industry participants and the Malaysian capital market.
"Consolidation, as a strategic initiative, will streamline both regulatory and market development functions of KLSE and MESDAQ, with the objective of offering investors, issuers, market intermediaries and market participants a wider range of products and services in the most convenient, efficient and cost-effective manner.
"This is essential to meet the demands of diverse investor profiles and competitive capital raising requirements," he said at the signing ceremony.
Mohd Azlan said the Securities Commission played a key role in fully supporting the consolidation of KLSE and MESDAQ, and looks forward to their continued support to ensure its success.
President of MESDAQ Abdullah Abdul Hamid said the merger with KLSE will allow investors to gain better access to listed securities of MESDAQ via KLSE's wider network of stockbroking member companies.
"MESDAQ's role as a choice market for high growth and technology based companies to raise funds will be considerably enhanced, locally and internationally," he added.
KLSE and MESDAQ first signed a Memorandum of Understanding (MOU) on 27 June 2001 to facilitate discussions on the best ways to integrate MESDAQ into the KLSE Group. The MOU sets the agreement for both parties to enter into detailed negotiations to pursue consolidation.
A joint working committee headed by Securities Commission and comprising representatives from KLSE and MESDAQ was formed to ensure that the exercise is in line with recommendations of the CMP to establish a single Malaysian exchange through the consolidation of all existing exchanges by 2002.
Securities Commission Chairman Datuk Ali Abdul Kadir said the consolidation has expanded market development capabilities for both exchanges and is an important step towards the creation of a single Malaysian exchange as envisaged in the CMP.
"Following this consolidation, the Securities Commission looks forward to both KLSE and MESDAQ ensuring the market for high growth and technology based companies is not only maintained, but fully developed.
"This will contribute to make the national capital market more competitive and more attractive," he said.
Until the consolidation is finalised and implemented, both exchanges will continue to operate as usual, with MESDAQ continuing to receive listing applications. The consolidation between KLSE and MESDAQ is subject to approval from members of KLSE, the Foreign Investment Committee and Securities Commission.
