M&A transactions involving public listed companies

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For those who like adrenaline packed corporate exercises, M&A transactions would be exciting for them.

M&A transactions involving public listed companies would probably be even more exciting.

If the seller or buyer is a company listed on Bursa Malaysia or a subsidiary of a company listed on Bursa Malaysia, the listed company must comply with Chapter 10 of the Main Market Listing Requirements or ACE Market Listing Requirements if the transaction triggers the specified thresholds.

The requirements may include:

1. Announcement to Bursa Malaysia when the sale and purchase agreement is signed.

2. Issuance of circular to shareholders of the listed company for the purpose of convening an extraordinary general meeting and seeking shareholders’ approval for the transaction.

3. Announcement to Bursa Malaysia when the sale and purchase is completed.

Even if the transaction does not trigger the thresholds in the Listing Requirements, the listed company should consider whether the transaction is “material information” which requires immediate public disclosure under the Listing Requirements.

Information is considered material, if it is expected to have a material effect on:

1. the price, value or market activity of any of the listed company’s securities; or

2. the decision of a holder of securities of the listed company or an investor in determining his choice of action.

Material information may include information which:

1. concerns the listed company’s assets and liabilities, business, financial condition or prospects;

2. relates to dealings with employees, suppliers, customers and others;

3. relates to any event affecting the present or potential dilution of the rights or interests of the listed company’s securities; or

4. relates to any event materially affecting the size of the public holding of its securities.

Paragraph 9.04 of the Main Market Listing Requirements and Rule 9.04 of the ACE Market Listing Requirements set out examples of events which require immediate disclosure.

Some of the memorable M&A transactions I worked on involved public listed groups and working round the clock on the agreements, announcements and circulars to shareholders.

What type of experience have you had?

#malaysiancorporatelawyer
#mergersandacquisitions
#listingrequirements

This post was first posted on Linkedin on 27 August 2021.

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