Auditorium of the Stock Exchange of Singapore (SGX).
Roslan Rahman | AFP | Getty Images
Singapore- Stock Exchange of Singapore Loh Boon Chye, CEO, told CNBC in an exclusive interview.
SGX announced earlier this month New rules that allow SPAC to list On that platform. Mr Law said the exchange is in talks with potential sponsors and is looking at a “strong pipeline” of potential lists.
“I think some of them will be successful in looking for submissions within the next few weeks,” said the CEO.
“But obviously, the market has to hold for them to be submitted and actually list and raise money,” he added. “We believe that if the market continues to rise steadily, some of those pipelines will crystallize into real IPOs.”
SPAC, or special purpose acquisition company, is a shell company that does not have a business. They are usually created and sponsored by institutional investors with the sole purpose of raising funds through the first public listing and eventually acquiring another business.
SPAC has been around for decades in the United States, but as an alternative for private companies to list on the stock exchange, it bypasses traditional IPO routes that can be a time-consuming and complex process. The popularity has exploded over the past year.
SGX has been trying to boost its IPO activities in Singapore for years, but has struggled to get a key technology list, one of the hottest investment trends in the world.
On Friday, the Government of Singapore announced a package of the following initiatives: Invite “promising high-growth” companies to the list In a city-state.
The Covid-19 pandemic caused economic uncertainty, but did not significantly undermine optimism among investors, Loh said. Along with the efforts of the government and SGX, such sentiment in the market could help boost IPO activities in Singapore, the CEO said.
“In today’s low interest rate environment, investors need to look for yields for returns, and that goes on,” he said. “A low interest rate environment is generally positive for stocks and, as a result, positive for financing and initial public offerings.”
According to Deloitte data, SGX conducted three IPOs in the first half of 2021 with total revenue of S $ 337 million ($ 250.54 million). This is shown by the data compared to 11 IPOs that raised approximately S $ 1.34 billion throughout 2020.
While tech stocks have been in the spotlight of investors over the past year, Loh said companies in the “traditional sector” are resilient through a pandemic.
“These are strong sectors, and if you’re a strong company in it, don’t forget to reward your shareholders,” said the CEO.
Singapore benchmark Straits Times Index Dominated by financial and real estate stocks. This year, it outperformed its peers in many regions, up about 7.8% on Thursday’s closing price.
Loh said it’s only natural that SGX will see some changes in the composition of listed companies as companies in the digital economy sector grow. He told CNBC that he hopes more tech companies will go public on the SGX with an initiative announced by the government on Friday.
“Some of these new economy companies we talked to … have operations from Singapore and beyond Singapore in this part of the world. When some of these are on the market I’m looking forward to it. ”
— CNBC’s Weizhen Tan contributed to this report.
SGX CEO, High-Tech IPO on Initiatives to Attract SPAC Listings in Singapore
Source link SGX CEO, High-Tech IPO on Initiatives to Attract SPAC Listings in Singapore