12
| COMPANIES & MARKETS
The Business Times | Thursday, October 9, 2014
Removal of one-share-one-vote rule
❚❚
CapitaMalls Malaysia Trust
gets new CEO
Different share classes allow public firms more flexibility in raising capital; offer investors a wider range of choices
By Malminderjit Singh
[email protected]
@MalminderjitBT
Singapore
PUBLIC companies in Singapore will
soon be able to offer shares with multiple voting rights, as parliament approved a bill on Wednesday resulting
in the largest number of proposed reforms to the Companies Act since its
enactment.
The Companies (Amendment) Bill
proposed the removal of the
one-share-one-vote restriction for
public companies, to give them greater flexibility in raising capital, and
provide investors with a wider range
of investment opportunities.
"The United States, the United
Kingdom and Australia already allow
companies to issue classes of shares
with different voting rights subject to
the companies' articles, although in
Australia, listed companies are prevented from doing so by listing
rules," Senior Minister of State for Fi-
nance and Transport Josephine Teo
said in Parliament.
"Clearly, there are benefits and
drawbacks in allowing shares with different voting rights. However, I
should point out that the concept of
such shares is not entirely new in Singapore and they have been permitted
in private companies for some years."
Moreover, Mrs Teo added that in
the Companies Act amendments of
2003, the one-share-one-vote restriction was lifted for private companies
that are subsidiaries of public companies and that the government has
now decided to lift the restriction in
the Companies Act for public companies in view of global developments
and demands of increasingly sophisticated investors.
"The change will not affect listed
companies for now, as MAS and SGX
are still deliberating on the issue.
Rather, it is the 800 or so non-listed
public companies that can take immediate advantage of the liberalisation."
Some members of Parliament,
however, expressed concerns on whether Singapore should allow a different shareholder classification regime.
Ong Teng Koon highlighted the need
to mitigate the risks in allowing
shares with different voting rights,
while Liang Eng Hwa called on educating retail investors on this change as
well as raising the question of determining prices for the different classes of shares.
"Mr Ong has highlighted the need
to mitigate the risks in allowing
shares with different voting rights. Although Mr Ong's comments are made
in the context of shares of listed companies, I would like to assure members that the Bill will put in place
checks and balances for all public
companies, whether or not they are
listed."
Specifically, she added, the Bill
will require public companies to specify the rights for different classes of
shares in their constitutions, and
clearly demarcate the different classes of shares so that shareholders
know the rights attached to any particular class of shares.
On Mr Liang's point, Mrs Teo explained that pricing of different classes of shares will be determined by the
issuing companies and may involve
valuation by investment banks and
road shows with potential investors.
"Ultimately, investors will have to assess whether the premiums or discounts offered for each class of
shares are fair."
This measure came out of a comprehensive review of the Companies
Act done by a Steering Committee led
by Professor Walter Woon, set up by
the Ministry of Finance (MOF). Other
amendments to the Companies Act include the introduction of a "small
company" concept to determine audit
exemption, replacing the current criterion where a company is exempted
from auditing its accounts annually
only if it is an exempt private compa-
Mrs Teo says “it is the 800 or so
non-listed public companies that
can take immediate advantage of
the liberalisation”
ny and has annual revenue of S$5 million or less.
"In future, to qualify for audit exemption as a ‘small company’, a company must be a private company that
meets at least two of three criteria for
each of the previous two financial
years, which are: total annual revenue not more than S$10 million; total
assets not more than S$10 million; or
number of employees not more than
50," Mrs Teo explained.
Global Yellow Pages inks first property deal
By Andrea Soh
[email protected]
@AndreaSohBT
Singapore
GLOBAL Yellow Pages, in its first-ever
deal in the real estate sector, is planning to buy a shopping mall and its accompanying land in New Zealand.
This, however, will be done in a
roundabout way, through an intermediate firm controlled by Global Yellow
Pages’ CEO Stanley Tan and director
Pang Yoke Min.
The original owners of the freehold shopping mall – Ladstone Pakuranga Limited and Ladstone Pakuranga Management Limited – had
first sold the property to Pakuranga
Plaza Limited (PPL) on Sept 9 for
NZ$96 million (S$95.8 million).
The mall, which is located in the
centre of Pakuranga in Auckland, oc-
cupies 39,209 square metres, and has
retail and office space with a gross lettable area of 29,541 square metres
that is occupied by about 100 tenants, including major department
stores and supermarkets.
Under the terms of the deal, PPL
had to pay 5 per cent of this amount
as a deposit by Oct 8, and another 5
per cent when it obtained approval
under the Overseas Investment Act of
New Zealand. The remainder was to
be paid on the settlement date stipulated in the agreement.
Global Yellow Pages had wanted to
buy PPL shares directly from its previous shareholder, but this acquisition
would have been conditional on the
approval of its shareholders in a general meeting. Ladstone Pakuranga
Limited and Ladstone Pakuranga Man-
agement Limited had not wanted any
condition allowing PPL to defer completion of the acquisition until the
firm had obtained all regulatory approvals.
Therefore, another intermediate
firm Pakuranga Plaza Holdings – set
up in New Zealand for this acquisition
and controlled equally by Mr Tan and
Mr Pang – on Tuesday bought over all
the PPL shares.
Global Yellow Pages will be taking
over all of PPL shares for NZ$38.4 million, which it intends to finance
through a rights issue completed in
June and internal funds; PPL intends
to borrow S$57.7 million to finance
its own purchase of the property.
The NZ$38.4 million that Global
Yellow Pages will pay to Pakuranga
Plaza Holdings will comprise: a deposit of NZ$9.6 million when PPL’s deal
with the mall’s original owners is declared unconditional; a deposit of
NZ$28.8 million a day before the settlement date of that deal, and NZ$1
when Global Yellow Pages has obtained consent from its shareholders
in an extraordinary general meeting
and regulators.
If approval from shareholders or
regulators is not granted, Pakuranga
Plaza Holdings, with Mr Tan and Mr
Pang as the guarantors, will together
repay the first two deposits to Global
Yellow Pages within 40 days.
Global Yellow Pages said that this
acquisition will enable the group to diversify into real estate, in which it
sees potential for long-term growth
and in which both its chairman Mah
Bow Tan and Mr Tan have significant
experience.
According to a valuation report by
IN BRIEF
property consultancy JLL dated Feb 6
this year, with the purchase price of
S$96.2 million and an occupancy rate
of about 97 per cent, the net rental
yield of the property is about 8.1 per
cent. “The acquisition is therefore income accretive in nature, and will generate profits that may be used to fund
the working capital of the group,” Global Yellow Pages said in the announcement.
The firm, which has also identified
food and beverage as another sector
to diversify into, had also last month
completed the purchase of the intellectual property rights held by
Wendy’s Supa Sundaes and Innovation Ice Cream for A$10 million
(S$11.7 million).
The counter, which has fallen 46.4
per cent so far this year, dipped 0.1
Singapore cent to close at 4.3 Singapore cents on Wednesday.
CapitaMalls Malaysia Trust
(CMMT) has announced that
Sharon Lim, CEO of the trust
manager CapitaMalls
Malaysia Reit Management,
has resigned for personal
reasons. She will be
succeeded by her deputy,
Low Peck Chen, from Nov 1.
“Ms Lim will help facilitate
the leadership transition until
the end of the year,” CMMT
said on Wednesday.
MLT buys two assets in
China for 402.8m yuan
MAPLETREE Logistics Trust
has completed the
acquisitions for two logistics
parks in Shanghai and
ZhengZhou in China for a
total amount of 402.8 million
yuan (S$83.9 million). Both
are fully funded by debt;
MLT’s total leverage ratio has
therefore risen to about 35.2
per cent.
Raffles Education to list
subsidiary in Hong Kong
RAFFLES Education will be
spinning off a subsidiary,
Oriental University City
Holdings (HK), on the Growth
Enterprise Market on Hong
Kong’s stock exchange. The
listing is subject to clearance
from Singapore Exchange and
the approval of the Stock
Exchange of Hong Kong.
Sino Grandness gains
Thai investors
SINO Grandness Food
Industry Group is issuing a
total of 86 million new
ordinary shares at S$0.61
each to two Thai
conglomerates. Thoresen Thai
Agencies will hold a 9 per
cent stake with its
subscription of 60.6 million
shares, while PM Group will
own 3.77 per cent with 25.4
million shares.
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