Hong Kong exchange, spurred by Alibaba, Xiaomi listings, proposes expansion of IPO reforms to attract more tech giants
- HKEX wants to allow companies that have other firms as owners with weighted voting rights to list in the city
- Proposal might attract new economy, technology companies, but might not be fair to other investors, lawmaker says
According to a consultation paper released on Friday, HKEX wants to allow companies that have other firms as owners with such special voting rights to list in the city. The bourse operator will seek views from the market until May 1.
“As part of the consultation proposal, we have sought to put forward various viewpoints, reflecting the complex nature of the subject and the need for a robust regulatory regime to fairly reflect the benefits and risks of such a regime,” Bonnie Chan, head of listings at HKEX, said. “The exchange’s proposed safeguards seek to address risks that are particular to corporate WVRs, such as the risk of an ‘evergreen’ WVRs structure, in order to maintain an appropriate level of investor protection.”
The April 2018 reforms, which allowed companies with WVRs to list in Hong Kong in the first place, only let individuals who were founders or key management of companies to hold shares with more voting rights or weight than other, regular shareholders.
