SINGAPORE, Sept. 17 (Reuters) – Singapore on Friday decided to attract high-growth local and foreign companies to raise capital on the Singapore Stock Exchange and broaden the city-state’s appeal as a funding center with a set of financing and incentive measures.
With a small base of retail investors in a city of 5.7 million people, SGX has struggled to capture large regional initial public offerings (IPOs). It has also seen a wave of write-offs, although it remains a global fundraising location for real estate investment trusts.
Singapore’s Ministry of Trade and Industry said the government and state investor Temasek will establish a co-investment fund to invest in late-stage private finance and IPOs of companies at strong growth, in order to anchor their listings in Singapore.
The move comes after SGX earlier this month unveiled new rules allowing listings of special purpose acquisition companies, marking the first Asian exchange to do so since the waning US SPAC frenzy began last year. .
With an initial tranche of S $ 1.5 billion ($ 1.1 billion) in capital, the fund will be managed on a commercial basis by 65 Equity Partners, a new investment platform wholly owned by Temasek.
EDBI, the investment arm of the Singapore Economic Development Board, will also establish a new âGrowth IPO Fundâ to invest in late stage companies, typically two rounds of financing or further from public listing.
Currently, EDBI is making start-up investments.
From a fund of up to S $ 500 million, EDBI will partner with companies to expand their operations in Singapore for listing on SGX.
Friday’s proposals were jointly announced by the Ministry of Trade and Industry, EDBI, Temasek, the Monetary Authority of Singapore and SGX.
Singapore’s Monetary Authority, its central bank and integrated financial regulator, said it would improve its subsidies that support stock quotes in the financial hub.
The regulator will also increase co-financing of listing spending for all companies and increase grants to hire equity research analysts to increase coverage of locally listed companies. ($ 1 = 1.3454 Singapore dollars) (Reporting by Anshuman Daga; Editing by Alexander Smith)