Capital Markets News

Do you know? Special purpose acquisition company (SPAC) in Malaysia: Unlike Malaysia, SPACs in the US are thriving because (1) The US SEC adopted a market-driven approach instead of seeking to overly-protect investors (2) No SEC approval is needed for acquisitions (3) time limit extensions for acquisitions are common and (4) a simple shareholder majority…

Do you know? Special purpose acquisition company (SPAC) in Malaysia: The SC has indicated it may revisit the SPAC concept in the future, possibly aligning it with digital exchanges or cross-border listings e.g. Singapore or Nasdaq. Equity Debt Digital assets M&A Malaysian Other markets

Do you know? Special purpose acquisition company (SPAC) in Malaysia: After Sona’s failure in 2016, no new SPACs were filed and the framework became dormant. In Mar 2022, the SC officially suspended the SPAC framework citing the lack of market interest and their need to review the relevance of the framework. Equity Debt Digital assets…

Do you know? Special purpose acquisition company (SPAC) in Malaysia: Some of the reasons mentioned by investors and analysts for SPAC’s failure in Malaysia are (1) investors preferred tangible projects like oil and gas (2) strict QA approval and valuation rules made acquisitions very hard (3) 3-year deadline is too short to conclude oil and…

Do you know? Special purpose acquisition company (SPAC) in Malaysia: Only 3 SPACS were ever listed on Bursa Malaysia (1) Hibiscus Petroleum raised RM240m in 2011 and is still listed (2) Sona Petroleum raised RM550m in 2013 but its QA failed to obtain SC’s approval and the funds were returned to investors in 2016 and…

Do you know? Special purpose acquisition company (SPAC) in Malaysia: The SC issued a SPAC framework in 2011, which was one of the first in Asia. The rules include: (1) minimum RM150m IPO size (2) 90% of proceeds to be placed in a trust account (3) must complete a qualifying acquisition (QA) within 3 years…

Do you know? Special purpose acquisition company (SPAC) in Malaysia: A SPAC is a blank-cheque company i.e. a shell entity that raises money through an IPO, without any business operations. It must acquire or merge with a private target within a set time frame, usually 3 years. Investors buy into the management team’s track record,…

Do you know? Private investment in public equity (PIPE): Some difference between PIPE and private placement in Malaysia are (1) listed companies in Malaysia must obtain shareholders’ approval and Bursa Malaysia’s approval before the private placement of shares (2) SC approval is required for the issuance of convertible debt (3) the placement share price in…

Do you know? Private investment in public equity (PIPE): The disadvantages of PIPE are (1) existing shareholders’ ownership gets diluted when new shares are issued (2) frequent PIPEs can signal that a company can’t raise money through normal public channels and (3) if PIPE investors sell quickly once their restrictions lift, the share price can…

Do you know? Private investment in public equity (PIPE): The benefits of PIPE to the investors are (1) they buy shares cheaper than market price (2) there is upside potential if the company performs well and (3) PIPEs that offer securities that convert into more shares later could increase return potential. Equity Debt Digital assets…