KUALA LUMPUR: The Securities Commission Malaysia (SC) has granted flexibilities for businesses issuing convertible notes to venture capital (VC) and private equity (PE) firms.
In a statement today, the SC said these flexibilities would allow businesses to lodge the issuance of their convertible notes directly with the commission without requiring the services of a principal adviser.
“Lodgement fees will also be waived, further lowering the fundraising cost,” it added.
The SC said this would particularly benefit start-ups, micro, small and medium-sized enterprises (MSMEs) as well as small- and mid-cap companies, allowing the fundraising process to be more cost-effective and reducing time to market.
Currently, there are 124 VC and PE firms managing an estimated total commitment of RM6 bil.
The SC said the issuance of the convertible notes would be facilitated through new requirements in the Guidelines on Unlisted Capital Market Products under the Lodge and Launch Framework, which will outline criteria for eligible convertible notes.
SC chairman Datuk Syed Zaid Albar said the SC continues to explore measures to ensure that the capital markets remain accessible, particularly for MSMEs.
“This initiative is part of a series of flexibilities introduced to meet the funding needs required to weather the current situation, as well as to prepare businesses for recovery beyond this crisis,” he said. – April 28, 2020, Bernama
