Major amendments to Exchange listing requirements

Press, 2 December 1985, Page 40

Major amendments to Exchange listing requirements

PA Wellington The New Zealand Stock Exchange has made some major amendments to its listing requirements to increase disclosure by listed companies and protect shareholders. The amendments result from the continuing review of listing requirements by the Exchange, and will take effect after listed campanies have had a chance to comment on them, the Exchange announced. Under one amendment, prior approval by shareholders will be required for a listed company or any of its subsidiaries to acquire or dispose of assets worth more than 5 per cent of the total issued capital and reserves of the company. Conditions for the requirement involve the status of either the seller or buyer but are widespread. The requirement applies to a director or officer of a party to the transaction, or any subsidiary, or the beneficial owner of 5 per cent of more of the listed companies’ voting capital.

However, the Exchange’s executive can decide if a shareholders’ meeting is needed where the seller or buyer is an associate of those people or companies. The notice of meeting containing the resolution to approve the transaction must be given to the Exchange for its approval. It must contain material, prepared by independent experts, which the executive deems necessary for the shareholders to decide whether the transaction price is fair. The vendor, purchaser or associates shall not be entitled to vote at any meeting convened to approve the transaction. Other amendments in- x elude:

© All application money a company receives for any offer of equity or debt securities shall be held on trust by the company in a separate bank account until the securities have been allotted. The company may retain any interest received while such money is held on trust if its intention to do so is clearly stated in the pros-

pectus. • When shareholders have authorised a share split or a name change, the company shall issue new scrip in the appropriate form to all shareholders, advising them that the old scrip has been cancelled. •No announcement of any benefit or other material matter may be made at a shareholders’ meeting or to the media unless full details have been given to the Exchange in advance. Companies can deliver such announcements under embargo. • Where the reported share of associated companies’ retained profits includes unrealised gains the profit report shall be endorsed accordingly. • Where a company acquires or disposes of any asset, it has to state full details of the consideration when it involves the issue of the company’s shares. Where the consideration is wholly or partly in cash, the company does not have to dislose the cash amount unless it exceeds 5 per cent of company or group assets.