SGX grants firms 6-month extension to comply with minimum trading price

Deadline was originally March of next year.

The local bourse is giving affected companies some breathing room to carry out a share consolidation to comply with the minimum trading price (MTP) requirement, as the 6-month volume-weighted average price (VWAP) of the shares of these companies will be assessed only on September 2016.

According to a statement by SGX, the extension, however, will only apply to companies which have consolidated their shares before March 2016, and the extension takes into account the impact of global market developments on the share price performance of firms, as well as feedback from investors and companies.

“The FTSE ST All-share Index has fallen 15.5% from March to November 2015 with a decline of 4.9% in the month of November alone,” SGX said.

Meanwhile, SGX says the companies which have carried out corporate actions such as mergers and acquisitions or reverse takeovers before 1 March 2016 can engage with SGX for a similar consideration on a case-by-case basis.

“Investors should continue to monitor their investee companies and prod them to take action to comply, and more importantly, improve the long-term business fundamentals. Companies should likewise announce their plans to comply with MTP and actively engage their shareholders. Share consolidation alone may not be the only option,” said June Sim, head of listing compliance at SGX.