Increasingly, companies are shifting away from traditional sources of funding in Europe and America and redirecting their focus towards Asia’s growing economy. For those interested in raising funds in Singapore, we offer a glimpse into the listings process of the Singapore Exchange (SGX).
To begin, SGX is Asia’s most international exchange, with more than 40% of companies originating outside of Singapore, mainly Southeast Asia, China, followed by Europe and the US. Presently, there are 750 companies listed on the Mainboard and Catalist, of which 2 companies are from Israel. Industries and sectors include real estate (REITS and property trusts), mineral, oil and gas, commodities, marine and offshore, and healthcare. As a matter of fact, SGX is currently trying to nurture the growth of more healthcare companies to be listed on SGX. For example, there are talks for the listing of an international healthcare group that runs hospitals and clinics, Cordlife Group, as well as a U.S. medical device company specializing in cardiology.
For listing on the Mainboard, there is a fixed listing criteria which requires the approval of SGX and the Monetary Authority of Singapore (MAS), Singapore’s central bank. On the other hand, there are no quantitative criteria for listing on the Catalist, and admission is dependent upon the discretion of the list of Sponsors approved by SGX. Sponsors will assess the suitability of companies to list, and are directly responsible and liable for corporate governance of the companies it takes on board of SGX.
Prior to application, pre-listing preparation work for listing documents is required. After which, review of submission by SGX would take 8-12 weeks or earlier.
Apart from regular fees to bankers, as well as formal legal and procedural fees, the Catalist usually charges 8 to 15% of funds raised, and 3 to 5% for the Mainboard, with an additional $50,000 to $100,000 annual fee to Sponsors for book building, underwriting, and other related services.
On the whole, SGX encourages companies with a strong Asian angle to join, particularly companies considering setting up a production center in Singapore or the region, or companies that already have activities in Asia. This is found to be preferred by investors and highly advantageous for companies listed, as investors would recognize the brand and company. This also allows better market access for companies listed, as suppliers and partners would accord higher trust and reliability in the companies for its association with SGX.
For more information on listing in Singapore, please contact the trade office or visit http://www.sgx.com/wps/portal/sgxweb/home/listings/getting_started/listing_process.