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Showing posts from January, 2019

SGX to get tougher on auditing of listed companies with proposed new rules

The Singapore Exchange is moving to tighten the auditing of listed companies, with two new rules, in one of its biggest overhauls of accountancy oversight.
First, the SGX is asking for the power to order a listed company to appoint a second auditor, in addition to the existing one, in "exceptional circumstances".
Second, the SGX will propose a change in the listing rules to require all listed companies to appoint a Singapore-based auditor.
The market regulator will be conducting a public consultation on these two proposals.
The move comes in the wake of the near-collapse of Singapore-listed Noble Group, once Asia's biggest commodity trader, which was given a clean bill of health for three years even as an attack on its accounting practices was sending its shares plummeting. The company eventually lost 99 per cent of its market value.
Some market observers were critical of Singapore regulators, saying they did not do enough to protect minority investors as the Noble saga unfol…

Catalist: A platform for growth firms or ICU for mainboard patients?

Catalist was established in November 2007 as the successor of Sesdaq, and is one of the two boards of the Singapore Exchange (SGX). Modelled after London's Alternative Investment Market (AIM), its sponsor-based regime is similar to AIM's system of regulation through nominated advisers. Its name reflects its vision of being a platform that catalyses the growth of young companies by giving them access to financing, and hopefully a transfer to the Mainboard. However, over time, the objective of Catalist seems to have changed somewhat as SGX now sees the Catalist board as providing "greater flexibility for a company to raise funds either to implement its growth strategy or to improve its financials" (emphasis ours).

The growth in Catalist listings has outstripped the Mainboard particularly over the last five years. Between 2014 and 2018, the percentage of IPOs accounted for by Catalist issuers increased from 60 per cent to 80 per cent, and the percentage of issuers liste…

MAS moves to attract listings, boost equity research talent

The Monetary Authority of Singapore (MAS) on Monday unveiled a S$75 million initiative to help boost equities research and enhance Singapore's status as a hub for equity listings.
Announcing the initiative, called the Grant for Equity Market Singapore (GEMS), Finance Minister and MAS board member Heng Swee Keat said the grant would further Singapore's vision to serve as Asia's centre for capital raising and enterprise financing.
GEMS comprises co-funding for listing costs of companies, with particular focus on the "new technologies" sector. It will also co-fund the salaries of equity research hires by 50 to 70 per cent.
Securities firms welcomed the support. Luke Lim, Phillip Securities managing director, said the firm is looking to hire more researchers with MAS's support. "While the benefits of the initiative may not be seen immediately, over time, we should see improved quality of coverage of companies for investors. Training analysts to provide good…

20 weeks' jail for disgruntled investor who rigged share prices

Over the span of a week in 2015, a stock investor manipulated the share price of mainboard-listed dye maker China Fibretech, causing the price of the counter to plunge from $1.60 to as low as $0.54.
Restaurateur Bruno Ludovic Soligny, 40, a naturalised Singapore citizen, was sentenced to 20 weeks' jail and a $60,000 fine on Monday (Jan 21) after he pleaded guilty to seven charges under the Securities and Futures Act, including four for market rigging.
He is appealing against the sentence and was offered bail of $40,000.
Soligny, a substantial shareholder in China Fibretech, dumped his shares over three days between July 1 and July 8, 2015, with the intention of driving the share price down.
A district court heard that he began buying China Fibretech shares in 2009 and increased his shareholding over the next few years.
In 2013,Soligny decided to use his wife's trading accounts to "rollover" his purchases as he did not have the means to pay for them.
He would buy the shares…

ISR Capital ordered to hold fresh shareholder vote on contentious African mine deal

ISR CAPITAL must get investors to ratify a recent mine purchase, or risk running afoul of listing rules.
Bourse regulator Singapore Exchange Regulation (SGX Regco) slapped ISR with a notice of compliance on Thursday - the latest development over a S$3 million deal for a rare-earth concession in Madagascar.
ISR said on Dec 31, 2018 that it had sealed a deal for the 60 per cent stake in Tantalum Holding (Mauritius), after waiving an earlier condition precedent for a cash flow budget and liquidity plan.
The investment company was then asked by SGX Regco to obtain shareholder approval for the waiver before it went ahead and paid for the deal with some 747.3 million new shares.
But ISR held that such approval was not needed because the waiver did not prejudice shareholders and would not have an adverse impact on the company.
ISR went ahead with the allotment and issue of the so-called consideration shares on Jan 3, 2019.
The board also issued a statement on Jan 5, where it said that the b…

SGX says no directive to ISR Capital over queries on mining asset purchase

The Singapore Exchange (SGX) said on Sunday that no directive has been issued so far to ISR Capital regarding its S$3 million purchase of a Madagascar mining asset.
Queries by the regulator to ISR Capital are ongoing, which "reflect our concern that new information was disclosed very close to the completion date" of ISR's purchase of a 60 per cent stake in Tantalum Holding (Mauritius) (THM). THM fully owns Tantalum Rare Earth Malagasy SARLU (TREM), which holds an exploration licence for the mining concession.
The query process is to ascertain whether shareholders should be asked to ratify the transaction, an SGX spokesman told The Business Times.
The SGX spokesman added that shareholders should continue to monitor closely the company's disclosures which the board of directors will be held accountable for.
The company announced on Dec 31, the day the long-stop date for the acquisition was supposed to be according to a circular in October, that it had extended the lon…

CNMC expansion plans on track despite HK dual listing setback

CNMC Goldmine's plans for a dual listing in Hong Kong may have hit a roadblock, but strong gold prices and an adequate cash pile will keep the company's expansion plans on track, say management and analysts of the Malaysia-focused gold-mining company.
"This is not in any way going to upset our expansion plans and whatever plans we have set for the group overall," CNMC chief executive Chris Lim tells The Business Times in a phone interview.
CNMC announced on Dec 24 that the Stock Exchange of Hong Kong had rejected its application for a dual listing. In its rejection, the bourse's listing committee said it was not convinced that the company could achieve its goal of creating "meaningful liquidity" for its shares in Hong Kong or meet the Hong Kong main board's minimum market capitalisation requirement of HK$500 million (S$87.04 million).
Mr Lim said that the intention to pursue a dual listing, which was announced at the start of 2018, was not to raise…

ISR waives sale condition for mining asset purchase to go through

ISR Capital's long-drawn S$3 million acquisition of a rare-earth mining asset in Madagascar will finally come to fruition as it has waived a sale condition so the deal can be completed, the investment company announced on Monday.
Completion of the deal was now scheduled to take place on Monday.
ISR has faced numerous queries by the Singapore Exchange over its purchase of the 60 per cent stake in Tantalum Holding (Mauritius) (THM), which fully owns Tantalum Rare Earth Malagasy SARLU (TREM). The latter holds an exploration licence for a rare-earth mining concession in Madagascar. The market regulator's queries have, among other issues, cast a spotlight on the valuation of the acquisition target.
The purchase has been in the works since June 2016.
The waived condition relates to ISR and the seller REO Magnetic agreeing on the project's cash flow budget and liquidity plan.
"As further studies will be conducted on the project after the completion, including but not limite…