PSE raises minimum public ownership
Companies debuting on the Philippine Stock Exchange are now required to bring to public hands at least 20 percent to 33 percent of their total shares, depending on market capitalization.
The new minimum public ownership requirement will apply both for companies applying for initial public offering or backdoor-listing effective immediately, the PSE announced in a memorandum on Tuesday.
The increase in public ownership from the previous minimum requirement of only 10 percent has been mandated by the Securities and Exchange Commission (SEC), which believes this would be necessary to increase market depth, improve market efficiency, reduce volatility and lead to better price discovery.
Based on a memorandum issued by PSE president Ramon Monzon on Tuesday, the minimum public ownership requirement will decrease the larger the market capitalization of the company is.
For companies with market capitalisation of over P1 billion, the requirement is 20 percent or P250 million, whichever is higher.
For companies with market capitalisation over P500 million to P1 billion, the minimum public ownership should be 25 percent or P100 million, whichever is higher.
A minimum of 33 percent public ownership or P50 million, whichever is higher, will be required for companies with market capitalization below P500 million.
Based on the memorandum, the company must maintain a public ownership level of at least 20 percent at all times after initial listing.
A company applying for listing by way of introduction is required to have at least 20 percent public float upon and after listing.
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