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17 out of 29 issues offered: SECP approves book-building regulations 2015

17 out of 29 issues offered: SECP approves book-building regulations 2015

ISLAMABAD: Continuing the practice of both the developed and emerging markets, the Securities and Exchange Commission of Pakistan (SECP) has approved the draft Book-Building Regulations, 2015 for issue of shares to the public.

According to the SECP, the existing book-building regulations, which are part of the listing regulations of stock exchanges, are not being enforced effectively as they are not applicable on book-runners, and lack any penalty clause. Seventeen out of 29 issues have been offered through book-building since the mechanism was introduced by the SECP in 2008.

The new regulations have the provision for payment of margin money through online transfer.

“It has been restricted on making consolidated bid that is the bid which is fully or partially beneficially owned by persons other than the one named therein,” said an official of the SECP, adding that the move would help make the deals more transparent.

Under the regulations the maximum bid size by a single bidder is 5 per cent of the book-building portion, while there will be no cap on upper limit of the bid size. At the same time, there will be no revision once the bidding period is closed.

The draft regulations will now be placed before the SECP’s policy board for final approval, after which the draft will be put on the commission’s website for inviting public comments.