Plans for second board set to move ahead with listing rules approval
The stock exchange council will today approve the listing rules of the Growth Enterprise Market (GEM), according to an exchange source.
The approval will move the market a step closer to its scheduled October start-up.
The rules would then be sent to the Securities and Futures Commission for final approval next week, the source said.
After SFC approval is received, the stock exchange will be able to invite companies to apply to list.
The first GEM listing would be seen in October, the exchange source said.
Meanwhile, brokers said as many as 20 companies were in the late stages of their preparations for a listing in the new market. They said a wide range of firms from the mainland, Taiwan and Hong Kong were in this group.
The GEM, which is being aimed at medium-sized companies, is to have less-stringent listing requirements but tougher disclosure rules than the main board.
Unlike the main board, which requires applicants to have had earnings of at least $60 million in the three years before the listing, GEM companies need only a two-year track record in their lines of business.
In addition, the minimum public float is to be set at 10 per cent of the issued share capital or $30 million, whichever is higher.
The exchange will also allow GEM companies to issue shares in US dollars in a bid to attract international investors.
However, companies will need to submit quarterly reports in a bid to ensure their transparency. Main board companies only need to report results twice a year.
In a bid to save costs for GEM companies, underwriting will not be compulsory for offerings to individual investors.
Companies will also be able to make announcements through the exchange's Web site instead of by paid advertisements.
GEM
