Alternative ownership limit raised to 90%
The CSE is undergoing a radical change following the agreement in principle by the Securities & Exchange Commission of the rules and regulations of the Main, Parallel & Alternative market, with the most important component being the change in the takeover law.
The proposal submitted by the CSE gives the majority owners of existing companies listed in the Parallel and Alternative markets the right to increase their direct ownership of their stocks to 74.99%, compared to the ruling until now under which they could hold only 70% and control another 5% through vague terms.
CSE Chairman Akis Cleanthous told the Financial Mirror that if majority owners decide to lift their stakes to 74.99% in their companies, then they will not be able to have other institutional investors hold 5% since they need to allow the public to hold at least 25% of the capital.
“If they wish to go beyond the 74.99% level, then they (majority owners) need to submit a takeover bid to increase their stake to either 80% or the maximum 90% permitted level,” said Cleanthous.
For new companies listing on the market, they may choose from the start to sell or disburse only 10% or 20% and keep the rest in the family.
More changes are also under way regarding the issue of marketability and the method and timing of trading, said Cleanthous. Irrespective of in which market a stock is listed in, the CSE plans to change the way trades are effected on such stocks.
A stock that seldom trades for example will not have continuous trading, but have a specific timing during which trades will be made based on the auction system.
“Once the common trading platform starts operating, then companies will need to increase their marketability and traded volumes. Otherwise, even if they are in the Main market, they will be forced to exit,” said Cleanthous.
THESSALONIKI CONFERENCE
Cleanthous will be one of the keynote speakers at the 3rd International Capital Markets Conference that will be held in Thessaloniki between 13 and 15 October. He will address the conference and speak about the common trading platform with the ASE for trading and settlement. The conference will also deal with the issue of accommodating dual listings among exchanges, where among others, Yiannis Kypri, BOC Group Chief General Manager, will analyse BOC’s dual listing on the ASE and the CSE.
Other issues include common trading platform, transfer and know-how, EU regulations, indices and introduction & development of derivative products.
