Markets
Potential of corporate advisers not fully tapped
Cheah Chor Sooi | 24 Nov 2017 00:30
No absolute advantage between banks and non-bank corporate advisers, says SIERAC Corporate Advisers Sdn Bhd executive director Teh Sew Hong
Many boutique advisory firms are finding that their true potential have never been tapped to the fullest as there are limitations as to what they are allowed to do.

Only investment banks – who already enjoy the competitive advantage of reputation and balance sheet to provide funding – and universal brokers are allowed to undertake initial public offerings (IPOs), manage a reverse takeover exercise and submit additional listing applications (ALA) for new issues of securities, among others.

As boutique advisers are unable to submit ALA, they are not allowed to act as advisers for private placement of shares, issuance of employees stock option scheme, rights issue, bonus issue and acquisitions via shares issues.

Often enough, boutique firms are entrusted with early stage support which entails low fees such as providing advice on cash transactions or independent advice on fairness and reasonableness of transactions.