What SGX RegCo expects of independent financial advisers for listed issuers

Under the Singapore Exchange’s (SGX) Listing Rules, an independent financial adviser (IFA) must be appointed for exit offers, interested person transactions (IPTs) and, in some cases, under a Notice of Compliance (NOC), to direct the issuer to undertake certain actions or review transactions as required by the SGX.

The purpose of requiring an IFA is to ensure that the directors receive an independent and professional opinion on a proposed transaction, including the impact on the issuer. In relation to IPTs, the directors should take into consideration such independent advice and make a recommendation to shareholders as to whether the transaction is on normal commercial terms and not prejudicial to the interests of the issuer and its minority shareholders.

For exit offers, the directors would make a recommendation on whether to accept the terms of the offer after taking into consideration the opinion of the IFA.