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Singapore Exchange - RHB Invest 2021-09-13: New Rules For SPAC Listings

SINGAPORE EXCHANGE LIMITED (SGX:S68) | SGinvestors.io SINGAPORE EXCHANGE LIMITED (SGX:S68)

Singapore Exchange - New Rules For SPAC Listings

  • SGX's latest announcement on the Special Purpose Acquisition Companies (SPAC) framework will allow companies to seek listing via SPAC on SGX, as long as it meets the criteria.
  • SGX is the first Asian major exchange to introduce the listing framework – in an attempt to attract more technology companies. While we are encouraged by this initiative, impact to earnings is difficult to assess currently.
  • Maintain NEUTRAL rating on SGX and target price of S$11.10, 9% upside.



New rules for SPAC listings.

  • SGX announced earlier this month the new rules for SPAC listings on its Mainboard effective 3 Sep 2021, making it the first major Asian stock exchange to offer the listing framework.


8 key features to be met by SPAC listing

  • SGX (SGX:S68) outlined eight key features to be met by any SPAC listing, which are as follows:
    1. Minimum market capitalisation of S$150m;
    2. De-SPAC must take place within 24 months of IPO (up to 12-month extension subject to conditions);
    3. Moratorium on Sponsors’ shares from IPO to de-SPAC, a 6-month moratorium after de-SPAC and for applicable resulting issuers, a further 6-month moratorium thereafter on 50% of shareholdings;
    4. Sponsors must subscribe to at least 2.5% to 3.5% of the IPO shares/units/warrants depending on the market capitalisation of the SPAC;
    5. De-SPAC can proceed if > 50% of independent directors approve the transaction and >50% of shareholders vote in support;
    6. Warrants issued to shareholders will be detachable and maximum percentage dilution to shareholders arising from the conversion of warrants issued at IPO is capped at 50%;
    7. All independent shareholders are entitled to redemption rights; and
    8. Sponsor’s promote limit of up to 20% of issued shares at IPO.


Our thoughts on SGX's rules for SPAC listings






Singapore Research RHB Securities Research | https://www.rhbinvest.com.sg/ 2021-09-13
SGX Stock Analyst Report BUY MAINTAIN BUY 11.10 SAME 11.10



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