The Securities and Exchange Commission of Pakistan (SECP) has issued a consultation paper seeking feedback on proposed improvements to the Listed Companies (Substantial Acquisition of Voting Shares and Takeovers) Regulations, 2017. This initiative aims to enhance transparency, strengthen the regulatory framework for takeover transactions of listed companies, and safeguard the rights of minority shareholders.
Announced in a press release on January 8, 2025, the SECP’s consultation paper outlines key areas for reform. Among the focal points are proposals to streamline public announcement timelines and revise price determination criteria for shares that are frequently and infrequently traded. These measures aim to ensure a fairer and more efficient process for all stakeholders involved in takeover transactions.
The SECP also emphasizes the importance of improved disclosure requirements for both acquirers and listed companies. By mandating more comprehensive information sharing, the regulator seeks to create a transparent environment that fosters investor confidence and promotes market integrity.
Additional proposals include provisions for voluntary offers, refined obligations for the Manager to the Offer (MTO), and mechanisms for handling indirect or chain acquisitions. These areas are identified as critical for ensuring that takeover regulations align with evolving market dynamics and international best practices.
The consultation paper is the product of an initial round of discussions with a diverse group of stakeholders, including market experts, MTOs, law firms, chartered accountants, and representatives of listed companies. By expanding the scope of consultations, the SECP aims to gather broader input, ensuring that the final amendments effectively address the needs of the market and its participants.
This collaborative approach is expected to result in a more robust regulatory framework that not only facilitates corporate takeovers but also protects the interests of minority shareholders. The SECP’s proactive measures reflect its commitment to fostering a fair and transparent capital market in Pakistan.
Stakeholders are encouraged to review the consultation paper and provide their feedback to help shape the future of takeover regulations. By incorporating diverse perspectives, the SECP seeks to ensure that its regulatory framework remains relevant and responsive to the changing dynamics of the market.
This initiative underscores the SECP’s ongoing efforts to strengthen corporate governance and enhance investor protection, contributing to the development of a resilient and transparent financial ecosystem in Pakistan.