The Securities and Futures Commission (SFC) has proposed altering the terms under which listed companies can be privatised, to ensure a small minority of shareholders can no longer block any proposed delisting.
At present, companies wishing to privatise must obtain approval from at least 90 per cent of their shareholders.
The commission yesterday issued a consultation paper, as part of its review of the Hong Kong Code on Takeovers and Mergers, that made two suggestions on how changes could be made.
The first is to reduce the 90 per cent trigger level to 75 per cent.
The second involves leaving the 90 per cent level unchanged but insisting those who vote against the proposal account for at least 2.5 per cent of the voting rights.
The SFC believes changes are necessary in light of cases when attempts to privatise have been prevented by a small minority of shareholders, even though the majority of shareholders have given their approval.
