18 August 2017
VOICE OF MSWG
Listing of Dual-Class Shares
Bursa Malaysia’s clarification that it has no plans to facilitate the listing of dual-class shares on Bursa Malaysia has come as a huge relief to us at the Minority Shareholder Watchdog Group (MSWG).
To do so would have been a huge disavowment of one of the central tenets of capital markets: that of one vote-one share. While other jurisdictions do allow it, notably the U.S., Brazil, Canada, France, Italy, Sweden, Switzerland, Denmark, Russia and Finland, the risks are there for all to see.
These run the gamut of abuse of management power, including prejudiced inter-company loans, mergers/acquisitions and related party transactions, all under the guise of ‘owner knows best’.
MARKET AND REGULATORY UPDATE
Malaysia Weighs Dual-Class Shares as Exchanges Battle for IPOs
It was reported by Bloomberg that Bursa Malaysia Berhad had in its emailed response to Bloomberg queries stated that it is considering whether to allow companies with dual-class share structures.
According to the report by Bloomberg, the structures give company founders and leaders outsized powers that are seen by investor advocates as undermining the one share, one vote system of corporate governance. Approval by Bursa Malaysia would mean opponents of the structures would face an increasing number of stock exchanges willing to list firms with multiple classes of stock.
[Source: Media release on Bloomberg’s website on 8 August 2017]
04 August 2017
VOICE OF MSWG
Sime Darby’s announcement of its new leadership teams at each of its three individual standalone units, i.e. Sime Darby Berhad, Sime Darby Plantation Berhad and Sime Darby Property Berhad, were positive on a number of fronts.
By informing the market several months before their listings on Bursa at year-end, shareholders will have been given enough time to digest the news while allowing the respective managers to get used to, and to settle into their new roles.
The appointments remove any doubt as to who exactly will oversee Sime’s Property, Plantations and Group units, with a clear reporting structure installed.