Singapore Exchange to Consider Dual-Class Share Structures

SGX Considers Dual-Class Structure
  • Bourse operator is likely to allow weighted voting rights
  • Move comes after Hong Kong scrapped similar proposals

Singapore Exchange Ltd. is likely to allow dual-class weighted voting rights for listed companies, after the city-state amended its laws this year to allow such structures, according to two people familiar with the matter.

The planned move comes after Hong Kong’s stock exchange operator in October scrapped a similar proposal after opposition from its regulator. Hong Kong lost the listing of Alibaba Group Holding Ltd., the biggest U.S. IPO on record, after refusing to allow its corporate governance structure. In the U.S., companies with more than one type of share, including Google Inc. and Facebook Inc., are subject to more stringent reporting requirements and shareholders have the ability to band together on lawsuits.

Under the proposals, listing applicants will need to meet certain requirements for dual-class shares, said the people, who asked not to be named because the discussions are private.

“As we have previously said, the proposal for dual-class shares has been submitted to the Listings Advisory Committee for its consideration,” an SGX spokeswoman said by e-mail. “We will leave it to the LAC to offer its independent advice.”

The committee is expected to publish its annual report before SGX’s annual general meeting on Sept. 22, the spokeswoman said.

Singapore has introduced rules to try to attract more public companies, including allowing the listing of resource firms without an earnings track record, as well as dual-currency trading for stocks and exchange-traded funds. 

The Business Times earlier reported the Singapore Exchange’s plans.

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