Connect with us

Hi, what are you looking for?

Economy

Voluntary delisting rules tightened

PSE
THE PHILIPPINE STOCK EXCHANGE, INC. has released new rules on voluntary delisting of companies. — BW FILE PHOTO

THE Philippine Stock Exchange, Inc. (PSE) has tightened rules on voluntary delisting after complaints from minority shareholders who were dissatisfied with the tender offer price given by companies that have delisted from the stock exchange in recent years. 

In a memorandum issued on Monday, the PSE said the Securities and Exchange Commission (SEC) had approved changes to voluntary delisting rules. These will take effect immediately.

“The delisting must be approved by: a. At least two-thirds of the entire membership of the board, including the majority, but not less than two, of all of its independent directors; and b. Stockholders owning at least two-thirds of the total outstanding and listed shares of the listed company,” the PSE said in the memorandum.

Under the rules, the company must also make sure that votes against the delisting plan do not exceed 10% of a company’s total outstanding and listed shares.

The previous rules required only the approval of a listed company’s board to delist.

Under the PSE’s new rules, a minimum tender offer price “shall be the higher of” the highest valuation based on a fairness opinion or valuation report given by an independent valuation provider. It should also be higher than the volume weighted average price of the listed security for one year immediately before the date of the company’s disclosure of the board approval of its delisting plan.

This changes the current practice of basing the tender offer price only on fairness opinion.

The new rules are a more objective guide to companies that want to delist from the market, Regina Capital Development Corp. Head of Sales Luis A. Limlingan said.

“The PSE wants to consider what is fair for all stakeholders in devising a more objective guide to delist from the bourse,” he said in a mobile phone message.

“It is fairer since all companies must follow a set of rules such as voting, timing, pricing, etc. released by the PSE,” he added.

The PSE crafted the new delisting rules in response to complaints on the delisting of Melco Resorts and Entertainment (Philippines) Corp. and Travellers International Hotel Group, Inc.

“PSE revisited the voluntary delisting rules following the receipt of complaints from the market that minority stockholders are essentially forced to accept a company’s decision to delist and the tender offer price offered by the listed company or delisting proponent, under the threat of being left with shares that have no secondary market,” the bourse operator said when the draft rules were released in December 2019. — Revin Mikhael D. Ochave

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Get the daily email that makes reading the news actually enjoyable. Stay informed and entertained, for free.
Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

Latest

Economy

THE PESO strengthened against the dollar on Tuesday amid easing global oil prices and ahead of an expected increase in remittances due to the...

Economy

PHILIPPINE STOCKS extended their climb on Tuesday on last-minute bargain-hunting and ahead of the rebalancing of the MSCI. The bellwether Philippine Stock Exchange index...

Economy

THE government financial institutions (GFIs) that will be tapped to provide capital and help manage a P250-billion sovereign wealth fund have disclosed their proposed...

Economy

THE European Chamber of Commerce of the Philippines (ECCP) urged the Philippines to eliminate tariffs on imports of all electric vehicles (EVs) regardless of...

Economy

PRESIDENT Ferdinand R. Marcos, Jr. is expected to sign an executive order (EO) that will fast-track applications for investments deemed strategic to the economy,...

Economy

AN Israeli tech investor said a country’s legal system is a major consideration in attracting foreign investment, and urged legislators to reform the tax...

You May Also Like

Investing

The minute that any question pops into your head, you can simply ask Google. No longer do we have to pour over books and...

Investing

Having a good Instagram marketing agency to back up your Instagram account is an absolute must going into the new year. With competition stronger...

Investing

Browsing history makes referring to sites and pages you’ve visited in the past seamless. It’ll help you recall what page you checked out on...

Investing

Insomnia is the most common sleep disorder in the global population. Therefore, it is a problem that many people suffer or have suffered throughout...

Disclaimer: SmartRetirementReport.com, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2021 SmartRetirementReport. All Rights Reserved.