SECP - Securities and Exchange Commission of Pakis : Demutualization: SECP approves documents submitted by stock exchanges
07/23/2012| 05:52am US/Eastern
Recommend:
Promulgated on May 7, 2012, the Act provides a framework for
the corporatization, demutualization and integration of the
stock exchanges. The demutualization will bring the Pakistani
capital market on a par with other international
jurisdictions, result in enhanced governance and transparency
at the stock exchanges and will attract strategic investors
which will not only provide equity and technical expertise
but will also result in increased visibility of these
exchanges on international capital market forums.
The approved documents include revaluation of assets and
liabilities of the stock exchanges, plans for the segregation
of commercial and regulatory functions and memorandums and
articles of association of the exchanges. The SECP has also
approved the authorized and paid-up capital of the exchanges
with the number of shares to be issued, names of initial
shareholders of the exchanges and the number and value of
shares to be allotted to each member, names of member
directors of the exchanges nominated by the exchanges, along
with names of SECP-nominated 6 directors on each stock
exchange to act as the first directors. Further, detailed
five-year development plans together with the capital
expenditure estimate and sources of finance along with SECP's
observations on the same in the interest of the market, have
also been approved.
The approval marks the achievement of an important milestone
towards completion of the said exercise. It is expected that
the stock exchanges will now be able to complete the
subsequent activities required in the Act and will stand
demutualized by September 3, 2012, as stipulated in the Act.
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