Knowledge Highlights 9 October 2020

On 29 September 2020, the Monetary Authority of Singapore (“MAS”), Securities Industry Council (“SIC”) and Singapore Exchange Regulation (“SGX RegCo”) announced that listed issuers and parties involved in rights issues and take-over or merger transactions will continue to have the option to electronically disseminate offer documents through publication on SGXNET and their corporate websites for another nine months, until 30 June 2021, due to the evolving Covid-19 situation.

With the extension, rights issues and take-over or merger transactions can proceed within safe distancing guidelines, effectively reducing physical interaction at workplaces needed to prepare, print and deliver a large number of offer documents. This extension is aligned to the extension of the alternative meeting arrangements under the Covid-19 (Temporary Measures) Act 2020. More information on the extension can be found in our article titled “Covid-19: Legislation for alternative meeting arrangements refined and extended to 30 June 2021”.

Under the temporary measures, issuers and parties who opt to disseminate their offer documents electronically must send:

  • a hardcopy notification to shareholders with instructions on how they can access the electronic version of the offer documents; and 
  • the hardcopy application or acceptance forms to shareholders.

These requirements will ensure that shareholders continue to be informed of these significant corporate actions by mail during this time and facilitate their participation in the corporate actions.

Parties undertaking rights issues or take-over or merger transactions are strongly encouraged to allow shareholders to apply and pay for the subscription of rights issues, accept offers and inspect documents through the internet. Details on internet channels may be set out in the hardcopy notification provided to shareholders. Shareholders are encouraged to use the internet channels where these are available.

As stated in a public statement by SIC, parties must consult SIC before they despatch take-over documents by post or electronically. These arrangements apply to offers announced on or before 30 June 2021, unless extended further.

By way of background, these temporary measures were initially introduced on 6 May 2020 and are effected through the Securities and Futures (Offers of Investments) (Temporary Exemption from Sections 277(1)(c) and 305B(1)(b)) Regulations 2020 for rights issues, and the adoption of alternative arrangements by SIC for take-over and merger transactions. SGX Listing Rules that require delivery of physical documents (e.g. SGX Listing Rule 1210 (Mainboard) and SGX Listing Rule 1207 (Catalist)) will also not be applicable during this period.

To provide guidance to issuers and their professional advisers on the publication of an electronic offer information statement and the inclusion of cautionary statements, MAS has also issued “Guidelines on the Securities and Futures (Offers of Investments) (Temporary Exemption from Sections 277(1)(c) and 305B(1)(b)) Regulations 2020”. 

Reference materials

The following materials are available on the MAS website www.mas.gov.sg:

Further information

Allen & Gledhill has a Covid-19 Resource Centre on our website www.allenandgledhill.com that contains knowhow and materials on legal and regulatory aspects of the Covid-19 crisis.

In addition, we have a cross-disciplinary Covid-19 Legal Task Force consisting of Partners across various practice areas to provide rapid assistance. Should you have any queries, please do not hesitate to get in touch with us at covid19taskforce@allenandgledhill.com.

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