Capital Markets

GROUPS LINKED TOGETHER

Capital Markets facilitate the growth in businesses with source of funding in both equity and debt markets. To help our clients to achieve their financing targets and business objectives, we provide a comprehensive range of services for capital markets transactions including both the equity capital market and debt capital market.

Our experience in handling both domestic and cross-border transactions coupled with our in-depth knowledge of securities laws enable us to represent and advise both issuers and sponsors in a variety of equity and debt offerings.

OUR KEY AREAS OF PRACTICE INCLUDE:

  • Initial public offering (IPO)
  • Cross-border equity offering
  • Takeover
  • Privatisation
  • Corporate reorganization
  • Schemes of arrangement
  • Private placement
  • Rights issue
  • Bonus issue
  • Employee Share Option Scheme
  • Regularisation plan

OUR KEY AREAS OF PRACTICE INCLUDE:

  • Initial public offering (IPO)
  • Cross-border equity offering
  • Takeover
  • Privatisation
  • Corporate reorganization
  • Schemes of arrangement
  • Private placement
  • Rights issue
  • Bonus issue
  • Employee Share Option Scheme
  • Regularisation plan

FREQUENTLY ASKED QUESTIONS

Your company will be assessed against two (2) benchmarks:

  1. Regulatory benchmarks – This aspect focuses on compliance with the relevant rules prescribed under the Equity Guidelines of the Securities Commission Malaysia and the Listing Requirements of Bursa Malaysia.  
  2. Market benchmarks – This aspect covers the non-prescriptive dimension which is purely market driven. The ability to meet investors’ expectation and convince them to invest in your company is one of the most important elements under the market benchmark.

Bursa Malaysia offers a choice of three (3) markets for companies seeking listing in Malaysia:

Main Market and ACE Market provide companies with greater visibility via the capital market and a clearly defined platform to raise funds from both institutional and retail investors.

  1. Main Market – a prime market for established companies that have met the standards in terms of quality, size and operations. Potential issuers for Main Market must demonstrate that they have achieved minimum profit track record or minimum size measured by market capitalization;
  2. ACE Market – a sponsor-driven market designed for companies with growth prospects. Sponsors must assess the suitability of the potential issuers, taking into consideration attributes such as business prospects, corporate conduct and adequacy of internal control; and
  3. LEAP Market – an adviser-driven market that aims to provide emerging companies, including small- and medium-sized enterprises with greater fund-raising access and visibility via the capital market. It is accessible only to sophisticated investors (as prescribed under the Capital Markets and Services Act 2007).

For more information on the listing criteria, please visit the website of Bursa Malaysia at https://www.bursamalaysia.com/listing/get_listed/listing_criteria.

The following are the summary of steps for an IPO:

Step 1: Appointment of professionals.

Step 2: Implementation and enhancement of the company’s corporate structure, composition of the board of directors, corporate governance and your internal controls framework.

Step 3: Discuss and decide on a suitable equity structure and method of the offering of your company’s shares.

Step 4: Preparation of listing application and the disclosure documents such as the prospectus/ information memorandum for the submission to the regulators.

Step 5: Submission of the listing application and the disclosure documents.

Step 6: Review the listing application and the disclosure documents by the regulators.

Step 7: Attend to the queries from the regulators.

Step 8: Issuance of the letter of approval for the IPO and the approval in principle for the prospectus registration (for Main Market and ACE Market listing application) by the regulators.

Step 9: Post approval implementation.

Step 10: Listing ceremony and the trading of your company’s shares will commence on that day.

For an IPO listing, rest assured that you will not be embarking on a solo journey. You will be guided by a team of professionals to help you meet the requirements and get your company listed successfully.

The parties that are usually involved are, namely:

  1. Principal Adviser/ Sponsor / Approved Adviser
  2. Lawyers
  3. Reporting Accountants
  4. Independent Property Valuers
  5. Independent Market Researcher
  6. Company Secretary

For more information on the approved list of adviser / sponsor, please visit the website of Bursa Malaysia at  https://www.bursamalaysia.com/listing/get_listed/list_of_approved_continuing_advisers_for_leap.

The listing process of each entity varies depending on the readiness of the company and the complexity of the company’s business.

The listing process (from the time you engage an adviser to the day of listing) will normally take four to nine months, depending on the structure and complexity of the listing scheme. Upon approval, you will be given six months to complete your IPO exercise.

For more information on the conceptual timeline of the listing process, please visit the website of Bursa Malaysia at https://www.bursamalaysia.com/listing/get_listed/listing_process.

The cost of listing depends on several factors such as the size and complexity of the case as well as the amount to be raised. In general, the total listing costs for ACE Market may range from RM2 million to RM5 million, for Main Market, it will usually be above RM3 million.

For more information on the cost of listing, you may visit Bursa Malaysia website at https://www.bursamalaysia.com/listing/get_listed/cost_of_listing.

The Bursa Malaysia Berhad (“Bursa Malaysia”) together with the Malaysian Investment Banking Association and the Association of the Corporate Finance Advisers has issued a practical guide to listing on Bursa Malaysia.

For a copy of the practical guide, please visit https://www.bursamalaysia.com/sites/5d809dcf39fba22790cad230/assets/5ea8ea6339fba25885eecafa/Going_public_guide_2020.pdf.

Gan Ming Chiek, Partner

Corporate, Capital Markets, M&A

© 2018 GLT Law – Gan, Lee & Tan. All Rights Reserved.

D-67-2, Block D, 72A, Jalan Prof Diraja Ungku Aziz,
Jaya One, 46200 Petaling Jaya, Selangor, Malaysia.