Dual listings pact to strengthen capital markets in Singapore and Norway
On July 8, 2009, Singapore Exchange Limited (“SGX”) and the Oslo Børs ASA (“Oslo Børs”) inked their co-operation with the signing of Memorandum of Understanding (“MOU”) to facilitate the process of secondary listing of companies on each other’s exchange.
This MOU marks the first formal co-operation between the two exchanges. It also represents the first dual listing co-operation with a sector focus between Singapore and Norway.
The proposed co-operation aims to promote the secondary listing of companies listed on each other’s exchange. SGX and Oslo Børs will institute a framework to enable and facilitate dual listings through mutually agreed listing rules and processes. In addition, both exchanges will set up a process for settlement and clearing of shares traded of these dual listed companies. The co-operation will begin with companies in the energy, offshore and shipping sectors which are key sectors common to both exchanges. SGX chief executive officer Hsieh Fu Hua noted that there are 47 of these companies listed on SGX and 89 such companies listed on Oslo Børs, making a total of 136 companies with a combined market capitalisation of $185 billion. As such companies expand their business activities to Norway or Singapore, the dual listing framework will allow them to diversify their shareholder base, build their profile and provide an additional fund raising venue. For a start, companies seeking dual listing should have a listing track record of three years and a market capitalisation of at least $200 million.
An example of a Singapore company listed on Oslo’s mainboard is EOC Limited (“EOC”), as one the leading owner and operator of floating production, storage and offloading, and offshore construction services contractor based in Asia. EOC is an associate company of Ezra Holding Limited, which is currently listed in SGX Mainboard.
Another area of co-operation is joint marketing and promotion. Both exchanges plan to commence a series of marketing seminars to profile the sectors in both regions in the coming months. SGX and Oslo Børs will enhance the co-operation framework by exploring opportunities in introducing new sectors, providing regulatory updates, monitoring and governance matters.
The MOU will enhance the attractiveness of the two exchanges as destinations for listings by shipping, offshore and energy companies, as well as those in other sectors. This will in turn reinforce the standing of Singapore and Norway as international maritime and financial centres. This collaboration will also boost Singapore’s efforts to position itself as a leading shipping and maritime hub in Asia.
This co-operation complements SGX’s Asian gateway strategy. Companies from Asia and Europe in the energy, offshore and shipping sectors will be better profiled and benefit from the larger investor pool. Investors on both bourses will also have a greater selection of investment choices.
Written by
Mr Nicholas Chang and
Ms Kitty Lo
Mr Nicholas Chang
Corporate Finance Executive,
Ph: (65) 6322-2236 | Fax: (65) 6534-0833
E-mail: nicholaschang@loopartners.com.sg
Ms Kitty Lo
Senior Corporate Finance Executive
Ph: (65) 6322-2231 | Fax: (65) 6534-0833
E-mail: kittylo@loopartners.com.sg
Loo & Partners LLP
88 Amoy Street, Level Three
Singapore 069907