SEC approves changes to delisting rules

AdChoiceTV News — The Securities and Exchange Commission (SEC) has approved the proposed amendments to the Philippine Stock Exchange Voluntary Delisting Rules.

According to the circular issued by the PSE on the amended voluntary delisting rules, the delisting of a company on the PSE must be approved by at least two-thirds of the entire membership of the board including the majority, but not less than two of all of its independent directors.

The delisting must also be approved by stockholders owning at least two-thirds of the total outstanding and listed shares of the listing company.

“Further, the number of votes cast against the delisting proposal should not be more than 10 percent of the total outstanding and listed shares of the listed company,” the PSE said in the circular.

The amended voluntary delisting rules also covered the tender offer price.

A tender offer occurs when an investor of a company proposes to buy shares from every shareholder of a publicly traded company for a certain price at a certain time.

The buyer normally offers a higher price per share than the company’s stock price, which is determined by a third party fairness opinion provider.

In the past, shareholders have complained about the low price offered by those doing the tender offer.

Companies decide to delist when they no longer see the benefits of being a listed firm and when they no longer want to go through the stringent disclosure process especially when it lessens their competitiveness.

The PSE earlier committed to address complaints from shareholders who are unhappy with the valuation of their shares when there is a tender offer.

The issuance of the amended delisting rules is part of the PSE’s efforts to improve corporate governance and protect investors. — via Letizia Tinoco / AdChoiceTV News

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