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Privatisation matters
13-07-2019, 05:15 PM. (This post was last modified: 13-07-2019, 05:18 PM by weijian.)
Post: #11
RE: Privatisation matters
In recent years, we have people like Richard Thaler winning the Nobel Prize for economics and people who are in charge, taking note and learning something about behavioral sciences. Kudos to Tan again, probably the best appointment at SGX for a long time. Actually what Tan is doing, directly helps SGX's bottomline on a first level - keeping companies listed and keep paying listing fees. On a 2nd level longer term, it creates more incentives for retail investors via a stronger safety net, whom are actually the ones that create most of the animal spirits (unfortunately lost in 2013 penny stock crash).

Taking a closer look at the responses to the delisting proposal - Point 1.10 is actually quite interesting as some bought up the possibility of a major shareholder that is not part of the offerer group having disproportionate say.

In the extreme case of a min 10% public float, let's say i have an Offerer A holding 70% and SSH/Hedge Fund B holding 20%. Under the new rules: Out of the 30% public float, SSH/Hedge Fund B will have a 66% (20/30) say but still lack another 10% to pass the 75% hurdle. So even if there a "under table/unofficial" effort by both Offerer A and SSH/Hedge Fund B to gang up, it will not pass by default with the 75% hurdle. This probably justify the reason why one needs 75%, rather than 50% on paper. But of course, if both of them really gang up in this extreme example, they can always count on the inertia of the minorities to work in their favor and they will probably succeed in practice.

Delisting response: https://api2.sgx.com/sites/default/files...711%29.pdf

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14-07-2019, 10:04 PM.
Post: #12
RE: Privatisation matters
The onus is on the corporate finance to prove that it is "fair" and "reasonable".

Usually the corporate finance guys have no balls to make these defining statements without proof and evidence.... they will pull out 100+ pages of past transactions and peer comparison to show the offer is "fair" and "reasonable"

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