Twelve (12) publicly-listed companies have only two remaining trading days to comply with the local stock exchange’s rule on minimum public ownership (MPO); otherwise, their stock will face trading suspension effective next week.
Despite a formal request from some companies to extend the deadline, the Philippine Stock Exchange (PSE) stood ground and reiterated its deadline of December 31, 2012 for publicly-traded firms to meet the required 10% public float level. What is the Minimum Public Ownership rule?
The public float requirement by the PSE requires publicly-listed companies to maintain at least 10% of its total outstanding stock to be owned by the general public. This policy ensures that publicly-traded companies are indeed “public” and not dominated by a single or few controlling shareholders.
What if companies will not or cannot comply?
Companies that failed to meet the December 31, 2012 deadline will be slapped with a 6-month trading suspension starting January 2013. After the suspension period, non-compliant firms will have their stock permanently delisted from the stock exchange.
What happens if my stock gets suspended or delisted?
Suspended or delisted will not be traded on the exchange. This means it will be difficult, but not impossible, to buy or sell stocks of those companies. In addition, transactions will be charged higher capital gains tax as opposed to transactions made on the exchange.
What companies are still non-complying with the public float requirement?
Here is the list of twelve (12) companies who have still not met the 10% minimum public ownership rule as of December 26, 2012.
Compare that with our previous list of companies that had public float levels of below 10% as of September 3, 2012 (PSE to delist 27 firms if 10% Public Float rule not met) and as of December 10, 2012 (25 PSE firms still below minimum public ownership level).