SGX issues rules to allow SPAC listing

The new rules for the SPAC listing are effective starting 3 September.

The Singapore Exchange (SGX) issued new rules allowing the listing of Special Purpose Acquisition Companies (SPAC) on its mainboard starting 3 September.

SGX CEO Tan Boon Gin said in a press release the SPAC framework will give companies “an alternative capital fundraising route with greater certainty on price and execution.”

Key features of the SPAC framework include a minimum market capitalisation of S$150m, de-SPAC must take place within 24 months of initial public offering (IPO) with an extension of up to 12 months subject to fulfilment of prescribed conditions, moratorium on sponsors’ shares from IPO to de-SPAC which is a “six-month moratorium after de-SPAC and for applicable resulting issuers, and a further six-month moratorium thereafter on 50% of shareholdings.”

Sponsors must also subscribe to at least 2.5% to 3.5% of the IPO shares/units/warrants, depending on the capitalisation of the SPAC, de-SPAC can proceed if it has the approval of more than 50% of independent directors and more than 50% of the shareholders are in favour of the transaction.

The rules also include that warrants issued to shareholders will be “be detachable and maximum percentage dilution to shareholders arising from the conversion of warrants issued at IPO is capped at 50%,” all independent shareholders are entitled to redemption rights and sponsor’s promote limit of up to 20% of issued shares at IPO.

SGX said it will work it the Securities Investors Association (Singapore) to increase the understanding of retail investors’ of SPAC, and will partner with the Singapore Institute of Directors to educate future directors of SPACs on their roles.

Jefferies said the new rules “bodes well for future listings and position SGX as a regional first-mover in providing growth capital for a vast array of companies across sectors.”

Deloitte, meanwhile, welcome the new SPAC framework, saying it is an important step that will place Singapore in the lead amongst exchanges in the Asia Pacific.

“In recent years, the rapid development in Southeast Asia has enabled high-growth companies and tech unicorns to pursue SPAC-backed listings. Singapore’s geographical position in the heart of Southeast Asia coupled with its stable economic and political systems, along with its extensive international investor outreach and proximity to SEA companies, has made SGX an attractive listing venue for SPACs to raise funds,” Tay Hwee Ling, Disruptive Events Advisory Leader at Deloitte Southeast Asia and Singapore, said.

“We recognise that Singapore’s SPAC market may not rival the U.S. boom but we see the new regime seeking to balance and offer a close alternative to that of the US for investors in this region,” Tay added.

Pascal Rapallino, Group Investment Structuring Leader at investment services firm IQ-EQ, said the framework will increase the competitiveness of SGX and the companies listed on the exchange.

Join Singapore Business Review community
Since you're here...

...there are many ways you can work with us to advertise your company and connect to your customers. Our team can help you dight and create an advertising campaign, in print and digital, on this website and in print magazine.

We can also organize a real life or digital event for you and find thought leader speakers as well as industry leaders, who could be your potential partners, to join the event. We also run some awards programmes which give you an opportunity to be recognized for your achievements during the year and you can join this as a participant or a sponsor.

Let us help you drive your business forward with a good partnership!

The sector scored 72.7/100 points in customer satisfaction in the Customer Satisfaction Index of Singapore.
The new system, set for implementation in 2022, will provide migrant workers with quality, affordable and accessible healthcare catered to their needs.
Four medical suppliers saw an average 48% increase in stocks as markets reacted to the new variant.
Their pre-departure tests in South Africa on 26 November were negative.
The new skills maps serve as a resource for training providers and financial institutions to design family office-related training.
Its high costs make the country a top choice for companies with higher-valued-added manufacturing.
HongKongLand had the most growth for the day.
It surpassed the Bloomberg consensus estimate of 14.5%.
The agreement aims to grow tourism and economic activities as borders reopen. 
It will also enter a loan agreement worth $210.6m.
The acquisition will be fully funded by cash through internal resources.
These countries are Cambodia, the Maldives, Sri Lanka, Thailand, and Turkey.
The decrease was driven by profit declines in their beer and non-alcoholic businesses.
Sources say the state-owned Chinese firm is in talks with advisers about the potential divestment.