SEC oks PPP listing rules

The Securities and Exchange Commission (SEC) has approved a pioneering framework for the stock market debut of any company that has bagged an infrastructure project under the public private partnership (PPP) program worth at least P5 billion.

“In support of President Duterte’s programs to sustain economic growth, listing PPP companies at the bourse will provide additional source of funding for PPP projects,” the SEC said in a press statement issued on Thursday.

The approved PPP supplemental listing and disclosure rules allow the PPP companies to tap the capital market for big-ticket infrastructure projects. The rules will be implemented by the Philippine Stock Exchange in coordination with the PPP Center.

Based on the framework, a company may apply for listing if it had been awarded a PPP contract. A special purpose company incorporated by the consortium that has bagged a PPP project to assume all rights and responsibilities of such project in accordance to the Amended BOT (Build-Operate-Transfer) Law and its implementing rules may also apply for listing.

The new framework waives the usual requirement of a three-year track record and operating history for PPP companies, provided that they are able to comply with the rest of the requirements for listing on the PSE’s main board.

To qualify for listing, the PPP project bagged by the company should not be less than P5 billion as indicated in the financial bid.

Existing shareholders of the PPP company are prohibited from offering their shares during the initial public offering period, which means that only primary shares will be allowed for sale.

As part of the additional disclosure requirements under the framework, a listed PPP company must submit to the exchange a business plan which may include its plans for liquidation and winding up, or a proposal for a new business, at least three years before the scheduled expiration of the PPP contract.

“SEC upholds competitive capital market, while ensuring protection of the investing public,” the corporate watchdog said.